Indonesia plans to extend export earnings retention

Indonesia is considering extending the minimum period for natural resource exporters to retain export earnings beyond three months, according to Chief Economic Affairs Minister Airlangga Hartarto.

The current rule requires exporters to keep 30 per cent of their proceeds in the domestic financial system for three months for exports over $250,000. Airlangga mentioned plans to revise the rule during a news conference.

The aim is to increase domestic foreign exchange supply, especially with recent pressure on the rupiah due to global risks. The policy faced criticism from exporters initially, but the government has offered attractive term deposits and loan collateral options to address concerns.

Airlangga mentioned that the government is contemplating extending a tax break on property purchases up to 5 billion rupiah ($318,167.36) next year. Additionally, they are considering exempting electric vehicles (EVs) from luxury tax.

Attribution: Reuters