BANDUNG, unpas.ac.id – The issue of implementing Value-added Tax (VAT) on Education service and staff/and staple is now widely discussed since the draft revision of the Law on General Provisions and Tax Procedures (RUU KUP) was released last week.
Economic Expert in Universitas Pasundan, Acuviarta Kartabi assessed that the government’s reason for imposing VAT in these two sectors was to increase revenue and cover the state budget deficit. Until now, tax revenues in Indonesia are still relatively low, while the burden of spending is increasing, especially for economic recovery.
“Faced with such condition, I see that the government attempt to find out certain strategy to increase the revenue. Therefore, such options occurred in order to cover up the deficit by charging the VAT on several commodities,” he explained on Tuesday (June 15th, 2021)
It needs to be informed that government plans to increase VAT on education service and staff/and staple as much as 12%, which is quite expensive. It is also seen accessible only by certain groups of people or those who are considered capable of doing so.
According to Acuviarta, if the issues are going to be released, it would be a burden for the community and increase the number of inflation. The demand on either staff/and staple commodities or education service will also tend to decrease.
“If the issue [on staff/and staple] was responded by the price increase, it would be such burden for consumers. This will also give impact on inflation, since education and staple are components that contribute to the inflation rate in Indonesia. If VAT is imposed, inflation will automatically be high because it is considered to encourage price increases,” he explained.
Related to the educational sector, if the government has the concept of implementing educational equality, the government itself seemingly seeks for an excuse to put in the tax in order to improve education sector in Indonesia. He thought that such patterns should still be studied more.
“When receiving the tax on education service, it would necessarily and probably not be spent on education only, but it could be used in other sectors. Also, private and international schools, for example actually help develop human resources that cannot be fully provided by the government,” he said.
Acuviarta also continued that to support the improvement of human resources, it needs huge fund and budget, therefore, compared to imposing the VAT, it is better for the government to focus on rolling out incentives so as not to injure economic recovery.
Seeing the current improvement condition, he estimates that RUU KUP will be difficult to continue, especially in the midst of the economic condition that has not yet recovered. In addition, the discussion is not included in the national legislation program.
“I see small possibility of continuing the VAT, especially this year. If next year the government insists on continuing, I think the discussion will be long,” he concluded. (Reta)*