CHAIRMAN of the Association of Indonesian Retailers and Shopping Center Tenants (HIPPINDO) Budihardjo Induansjah revealed that he asked the government to review the policy of increasing value added tax (VAT) which will rise to 12% next year.
“Our hope is to study the numbers first. What if it has to go up, what if it has to go down, socialization will be carried out. If possible, don’t go up, because then everything will go up even more,” said Budi when contacted on Wednesday (20/3).
Furthermore, Budi said that if VAT increases, what will definitely happen in the retail industry is an increase in prices, an increase in the prices of goods sold in restaurants, bookstores, clothing stores and so on.
Apart from that, Budi also said that the cash flow faced by the industry becomes increasingly difficult if the VAT figure is higher.
“There will definitely be an increase in prices, that’s what must be anticipated. The impact may be more like inflation will reduce purchasing power, we are worried that purchasing power will fall. We have to pay VAT, we have to pay for cash flow first, it’s called VAT for upfront. “It’s heavy. I think we have to pay 12% of our sales in advance, our cash flow is getting heavier,” he said. (Fal/Z-7)
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