The Ministry of Public Works and Public Housing (PU-Pera) through the Directorate General of Housing has added incentives for Value Added Tax Borne by the Government (PPN DTP) for property to make it easier for the public to obtain habitable housing.
”This provides real convenience. Convenience, an opportunity for people to get a house in an easier way, at a cheaper cost,” said Director General of Housing Iwan Suprijanto in Jakarta, Wednesday (28/8).
Iwan added that the addition of DTP VAT was part of the economic stimulus. ”Continuation of yesterday’s policy, actually,
“The relaxation from yesterday which ended in June has been extended until December 2024,” he said.
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For information, Coordinating Minister for Economic Affairs Airlangga Hartarto said that the Government has agreed to increase the VAT DTP property incentive from the previous 50% for the second semester of 2024 to 100% until December 2024. This policy is expected to encourage the ability of the middle class to drive the consumption sector as well as to strengthen the middle class which is considered to be the driving force of the economy.
The consumption and housing sectors have multiplier effect high. Middle class society is defined as a society with a consumption pattern with the largest expenditure usually in terms of the food and beverage sector, followed by housing, health, education, to entertainment or the service sector.
Currently, the housing sector is the second largest expenditure for the middle class, so government policies…
in this sector becomes important. The addition of VAT incentive facilities and housing subsidies have a positive impact on the sustainability of the middle class in the future.
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This DTP VAT is really felt by the middle class and this is a pretty good economic boost, so the government is extending it.
for property DTP VAT. The DTP VAT incentive policy for houses is stated in the Minister of Finance Regulation (PMK) Number 7 of 2024 which is an extension of the previous policy. DTP VAT is given on a taxable basis (DPP) of a maximum of IDR 2 billion which is part of the selling price of a maximum of IDR 5 billion.
In addition to making it easier for people to obtain livable homes, the addition of this incentive is expected to create leverage to improve property performance, especially in the condominium segment.
Senior Research Advisor Knight Frank Indonesia Syarifah Syaukat, in a press conference for Jakarta Property Highlight H1 2024 in Jakarta, Thursday (29/8), the performance of the condominium sector in Jakarta has experienced slow movement in recent years. He found that the average condominium sales rate in the first half of 2024 was around 96%, increasing by only 0.6% compared to the previous semester.
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”Currently, we see that out of around 23 thousand condominium units that are ready to be occupied, only 13% of the stock applies DTP VAT, generally in the middle class and spread across non-CBD areas of Jakarta,” said Syarifah.
Syarifah said that several condominium projects that apply VAT DTP in their sales stated an increase in sales of 3%-4% from the previous semester. Although not too significant, according to her, it is enough to provide hope for the movement of condominium transactions in early 2024. ”VAT DTP is undeniably helpful in providing magnitude
on new condominium sales. Since it was implemented in 2021 until this year, this incentive has provided sufficient stimulus to residential sales, especially landed houses and the condominium sector is no exception,” said Syarifah.
According to Coordinating Minister Airlangga, in a press conference in Jakarta, Tuesday (27/8), the government has agreed to increase the DTP VAT incentive for property from the previous 50% for the second semester of 2024 to 100% until December 2024. He said the policy aims to strengthen the middle class as the driving force of the economy. According to data from the Ministry of Finance, throughout 2024, around 22,000 residential units were absorbed using the DTP VAT incentive.
Add FLPP quota
The government will increase the DTP VAT incentive and FLPP subsidy quota to strengthen the middle class. Coordinating Minister for the Economy Airlangga Hartarto said that the government has agreed to increase the DTP VAT incentive for property from the previous 50% for the second semester of 2024 to 100% until December 2024. Then, the FLPP quota target was also increased from 166 thousand units to 200 thousand units starting September 1, 2024.
”So with these two policies which will come into effect on September 1 (2024), it is hoped that this will also encourage the capabilities of the middle class.
to boost the consumption sector. We know that the consumption and housing sectors are multiplier effect“-is high,” said Coordinating Minister Airlangga in a press conference entitled “The Role and Potential of the Middle Class Towards Golden Indonesia 2045” in Jakarta, Tuesday (27/8).
Coordinating Minister Airlangga said the two programs were aimed at strengthening the middle class, which is considered the driving force of the economy. He defined the middle class as a society with a consumption pattern where the largest expenditure is usually in terms of the food and beverage sector, followed by housing, health, education, to entertainment or the service sector.
Currently, the housing sector is the second largest expenditure for the middle class, so government policies in this sector are important. (S-1)
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