Jakarta – The public has reacted positively to President Prabowo Subianto’s announcement that the 12% Value-Added Tax (VAT) will apply exclusively to luxury goods and services.
Various segments of society expressed their views on the announcement made by Prabowo alongside Minister of Finance Sri Mulyani at the Ministry of Finance building in Jakarta on Tuesday (December 31).
Husni, an online motorcycle taxi driver, expressed his relief that the 12% VAT increase targets only luxury items.
“If it’s luxury goods that are taxed higher, that’s fine, as long as it doesn’t affect ordinary people. It’s actually beneficial because the tax increase means more government revenue. I’m grateful it’s only for luxury goods. Wealthy people with luxury lifestyles should pay higher taxes,” Husni said during an interview in Central Jakarta on New Year’s Eve 2025.
Another local resident, Fauzan, echoed similar sentiments. He praised the policy, emphasizing that the 12% VAT on luxury goods would help strengthen the nation’s financial foundation, supporting the country’s development efforts.
“In my opinion, it’s a good program. It indirectly helps reduce the government’s financial burden by strengthening the country’s fiscal base. Taxes, especially from luxury goods, are a significant source of national income. For a better and more advanced Indonesia, I fully support this policy,” Fauzan stated.
Husni further noted that the policy does not burden lower-income groups, calling it a fair approach.
“A 12% VAT on luxury goods isn’t a problem at all. It’s the right move,” he added.
As 2024 turned into 2025, residents expressed their hopes for President Prabowo’s administration, particularly regarding the prices of fuel and basic necessities. They urged the president to ensure that these essentials remain affordable.
“My hope is that fuel and basic goods like staples stay affordable given the current conditions. I also hope that this year’s president will be better than those before him,” Effendy said, sharing his expectations for the future. (RR)
