City to Impose New PKB Tax Rates

The city administration is going to impose a new progressive of motor vehicle tax rate (PKB). The policy is motivated with the recommendation results of the Presidential Working Unit for Supervision and Management of Development (UKP4) regarding 17 measures to solve congestion problem in the capital.

One of the background is the need for adjustments or rise against PKB progressive rates in the hope that people can break or hold to increase the ownership of a motor vehicle thus congestion can be minimized

Swiss Company Involved in PKB Management

"One of the background is the need for adjustments or rise against PKB progressive rates in the hope that people can break or hold to increase the ownership of a motor vehicle thus congestion can be minimized," said Head of Jakarta Tax Service, Iwan Setiawan, Tuesday (11/18).

He disclosed that PKB rate hikes also became a kind of educational elements to Jakartans not to behave consumptive, but rather refers to productive things. "If Jakartans have the budget to buy a motor vehicle, the money should be spent for investment," he told.

Setiawan furthered, such rate was already set in the city in accordance with the Bylaw No. 8/2010 with first vehicle scheme charged 1.5 percent, the second vehicle charged 2 percent, as well as third vehicle 2.5 percent and 4 percent for the fourth.

"We'd filed the draft bylaws on new PKB tax rate to the Home Ministry and its evaluation is hoped to be completed by the end of this month. Thus in December, it could already be socialized and be able to be applied in January 2015," he uttered.

He explains, the tax rate has increased from 1.5 percent to 2 percent for the first motor vehicle and 2 percent to 4 percent for the second vehicle.

"While the increase in the tax rate of third vehicle ownership is from 2.5 percent to 6 percent, and 4 percent to 10 percent for the fourth vehicle," he told.

He asserted, the number of four- and two-wheeled motor vehicle owners who actively pay tax to the city treasury is reaching more than 4.780,89 million. In details, four-wheeled vehicle is owned by more than 1.6 million people and two-wheeled reached more than 3.1 million people.

"Jakarta local revenue (PAD) will increase about Rp 2 trillion, following enforcement of the bylaw related with new this new progressive tax rate," he asserted.

Jakartans who have only one four- and two-wheeled vehicle is about 4 million people with the details, 1.5 million people (four-wheeled vehicle) and 2.7 million people (two-wheeled vehicle).

As for those who have four-wheeled vehicle with two units reached 100 thousand owners and motorcycle around 318 thousand owners.

"Four-wheeled vehicle ownership with three units is reaching 17 thousand, motorcycle 58 thousand, and four units or more 9,400 people and its motorcycle more than 23 thousand," he uttered.