Indonesian Businesses Slam Govt Entertainment Tax Hike

TEMPO.CO, Jakarta - The head of Indonesia's entertainment entrepreneur community Hana Suryani criticized the new entertainment tax of 40-75 percent, especially in Jakarta. The policy was not based on the perspectives of both entertainment consumers and entrepreneurs, she said.

"There should have been studies on consumers, including age range and income. Then, involve entrepreneurs [in the conception]," she told Tempo on Tuesday, Jan. 16.

Hana also touched on the previous 25-35 percent entertainment tax. She regretted the lack of comparative studies conducted by the Indonesian government. "[Comparative studies] with our neighboring countries such as Malaysia, Singapore, Japan, Thailand, which lower their entertainment tax," she said.

Entertainment tax, she said, must be lowered since tourism is now one of Indonesia's attractions. "How come the Ministry of Tourism and Creative Industry has a load of targets to make Indonesia a global tourist destination but is not supported by its tax policies?" she remarked.

Indonesia's 40 to 75 percent entertainment tax hike is regulated under Law No. 1 of 2022 on the Financial Relationships between the Central Government and the Regional Government. 

The provincial government of Jakarta also has raised the tax for discotheques, karaoke places, nightclubs, bars, and spas to 40 percent.

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