Luxury Tax Relaxation; OJK to Revise Rule on Vehicle Loans

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Laila Afifa

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  • TEMPO.CO, Jakarta - The Financial Services Authority (OJK) is preparing a rule for the relaxation of vehicle loans, following the government's announcement on an incentive on luxury goods' tax (PPnBM) for cars running on engines below 1,500 CC.

    "We support the policy by reducing the RWA (risk weighted assets) for vehicles with qualifications. We will make adjustments," OJK board of commissioners' member Heru Kristiyana said in a press conference, February 18.

    Heru said this policy was one of the stimuli issued by the OJK in 2021 as a Covid-19 relief. The rule will be issued before the PPnBM Incentive is put in effect, which is on March 1.

    In addition to credit relaxation for vehicles, the OJK is considering to provide relaxation for mortgages. 

    The government is preparing an incentive to lower the luxury tax goods for cars running on small engines of less than 1500 cc, namely sedan and 4x2s. This policy is aimed at pushing the growth of the automotive industry, with local purchases of motor vehicles above 70 percent.

    Read: Luxury Tax Cut; Activists Question Govt's Pledge on Sustainable Development

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