Indonesia plans to lower corporate tax rate from 25% to 18% in 2016: Media

Indonesia plans to cut the corporate income tax rate to 18 per cent from 25 per cent in 2016.
Indonesia plans to cut the corporate income tax rate to 18 per cent from 25 per cent in 2016.ST PHOTO: KEVIN LIM

JAKARTA (REUTERS) - Indonesia plans to cut the corporate income tax rate to 18 per cent from 25 per cent next year, a Cabinet minister was quoted as saying by the Indonesian media on Monday (Sept 28).

"We hope to finalise the plan soon for it to be effective next year," Coordinating Minister for Political, Legal, and Security Affairs Luhut Panjaitan told reporters over the weekend, the Kontan newspaper said.

In August, Finance Minister Bambang Brodjonegoro said the government would propose a revision of the income tax law to Parliament next year, including a plan to lower corporate income tax. But he said the lower rate would not be effective until 2017.

Mr Brodjonegoro was not immediately available for comment on Monday.

South-east Asia's largest economy grew an annual 4.67 per cent in the second quarter, the slowest in six years. Its currency is trading at 17-year lows.

President Joko Widodo is expected to announce the second installment of a stimulus package aimed at luring investors, addressing growth slowdown and supporting the shaky rupiah soon.