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Indonesian yard tax exemption awaiting president's approval

Indonesian yard tax exemption awaiting president's approval
The long-awaited Indonesian government plan to exempt shipyard companies from value and import taxes to make Indonesia’s shipbuilding industry more competitive is just waiting for the president's approval, local reports said.

“All relevant ministries have agreed to the plan. We are merely waiting for the president’s signature,” said Imanuel Silitonga, who leads the shipping industry division at the Ministry of Industry.

Indonesian ministries, however have yet to complete a list of ship components which are not manufactured in Indonesia that will be eligible for another import tax exemption.

“Together with the shipbuilders, we are trying to make a breakthrough,” Imanuel said. “We must discuss everything with counterparts at the Ministry of Maritime Affairs and Fisheries and the Ministry of Finance.”

The country needs up to IDR30trn ($2.3bn) of new investment in shipyards to enable President Joko Widodo’s plan to create a maritime trade axis across the archipelago by 2019 to take place.

Previous reports have said Ministry of Industry data shows that no new investment has entered the sector this year, and the Indonesia Shipbuilding and Offshore Association expects the dry spell to continue until the end of 2015 due to the slowing economy.