Jakarta Scraps Tax Exemption for Property Below Rp2bn Due to Capital Relocation: Observer

TEMPO.CO, Jakarta - Public policy observer from Trisakti University, Trubus Rahadiansah, commented on the latest policy of the Jakarta Provincial Government regarding the urban and rural land and building tax (PBB).

The new policy, stated in Gubernatorial Regulation No. 16 of 2024 signed by Acting Jakarta Governor Heru Budi Hartono, eliminates the tax exemption for a property with a taxable value (NJOP) of less than Rp2 billion.

Trubus believed that the tax implementation was not part of the post-pandemic economic recovery efforts, but rather due to Jakarta losing its special status and becoming the Special Region of Jakarta (DKJ). The central government is determined to relocate the capital to Nusantara or IKN in East Kalimantan.

“The tax is being reinstated because Jakarta will no longer be the capital city. This is affecting [the region's] income,” Trubus told Tempo via a phone call on Tuesday, June 18.

He observed that the DKJ is now aggressively seeking regional sources of income. As the nation’s capital, the Jakarta government has been helped by budget disbursements from the center. “It’s determined Jakarta, as a DKJ, must seek its own budget,” he added.

According to him, the tax implementation on property worth less than Rp2 billion indicates the city government's efforts, led by Heru Budi, to generate regional income. 

Trubus recalled that the zero-tax policy for property under Rp2 billion had been in place since the era of Governor Basuki Tjahja Purnama alias Ahok and was then continued in the era of Anies Baswedan.

In the latest policy by Heru Budi, meanwhile, the tax exemption is now limited to the first house. The second, third, and subsequent properties are subject to a 50 percent tax.

DESTY LUTHFIANI

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