






{"id":11480,"date":"2021-03-11T15:02:02","date_gmt":"2021-03-11T08:02:02","guid":{"rendered":"https:\/\/www.asiapropertyawards.com\/?p=11480"},"modified":"2021-06-04T16:09:06","modified_gmt":"2021-06-04T09:09:06","slug":"bets-on-middle-class-to-boost-home-sales-and-revive-pandemic-hit-economy","status":"publish","type":"post","link":"https:\/\/www.asiapropertyawards.com\/en\/bets-on-middle-class-to-boost-home-sales-and-revive-pandemic-hit-economy\/","title":{"rendered":"Indonesian government bets on middle class to boost home sales and revive pandemic-hit economy"},"content":{"rendered":"<p>The Finance Minister believes that a temporary tax break on homes for sale will \u201coptimise the purchasing power of the middle class\u201d<\/p>\n<figure id=\"attachment_11481\" aria-describedby=\"caption-attachment-11481\" style=\"width: 1104px\" class=\"wp-caption aligncenter\"><img decoding=\"async\" class=\"wp-image-11481 size-full\" src=\"https:\/\/www.asiapropertyawards.com\/wp-content\/uploads\/2021\/03\/Indo.jpg\" alt=\"\" width=\"1104\" height=\"664\" srcset=\"https:\/\/www.asiapropertyawards.com\/wp-content\/uploads\/2021\/03\/Indo.jpg 400w, https:\/\/www.asiapropertyawards.com\/wp-content\/uploads\/2021\/03\/Indo.jpg 600w, https:\/\/www.asiapropertyawards.com\/wp-content\/uploads\/2021\/03\/Indo.jpg 620w, https:\/\/www.asiapropertyawards.com\/wp-content\/uploads\/2021\/03\/Indo.jpg 190w, https:\/\/www.asiapropertyawards.com\/wp-content\/uploads\/2021\/03\/Indo.jpg 1104w\" sizes=\"(max-width: 1104px) 100vw, 1104px\" \/><figcaption id=\"caption-attachment-11481\" class=\"wp-caption-text\">Homes\u00a0valued\u00a0between IDR2 to 5 billion will only be charged half the tax. HywitDimyadi\/Shutterstock<\/figcaption><\/figure>\n<p><span data-contrast=\"auto\">From March until August, the <\/span><span data-contrast=\"auto\">government ministers announced the removal of<\/span><span data-contrast=\"auto\">\u00a0taxes<\/span><span data-contrast=\"auto\"> valued at USD350 million<\/span><span data-contrast=\"auto\">\u00a0for\u00a0<\/span><span data-contrast=\"auto\">some properties for sale to\u00a0<\/span><span data-contrast=\"auto\">further increase consumer confidence &#8212; especially that of the middle class &#8212; and aid the <\/span><span data-contrast=\"auto\">pandemic-hit\u00a0<\/span><span data-contrast=\"auto\">economy<\/span><span data-contrast=\"auto\">, reported\u00a0<\/span><a href=\"https:\/\/www.reuters.com\/article\/indonesia-economy-idUSL3N2KZ2DU\" target=\"_blank\" rel=\"noopener\"><span data-contrast=\"none\">Reuters<\/span><\/a><span data-contrast=\"auto\">.<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335551550&quot;:1,&quot;335551620&quot;:1,&quot;335559740&quot;:276}\">\u00a0<\/span><\/p>\n<p><span data-contrast=\"auto\">The 10 percent value added tax for properties priced below IDR2 bill<\/span><span data-contrast=\"auto\">ion (USD140,351) will be removed f<\/span><span data-contrast=\"auto\">or the next five months. Meanwhile, <\/span><span data-contrast=\"auto\">homes\u00a0<\/span><span data-contrast=\"auto\">valued\u00a0<\/span><span data-contrast=\"auto\">between IDR2 to 5 billion will only be charged half the tax, shared Finance Minister Sri Mulyani Indrawati.<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335551550&quot;:1,&quot;335551620&quot;:1,&quot;335559740&quot;:276}\">\u00a0<\/span><\/p>\n<p><a href=\"https:\/\/www.fitchratings.com\/research\/corporate-finance\/tax-rebates-rather-than-home-loan-rules-to-boost-indonesian-property-sales-04-03-2021\" target=\"_blank\" rel=\"noopener\">Fitch Ratings<\/a> said these tax rebates come with some requirements, including one unit max per person and restriction on sale for one year. The credit ratings agency added that this will &#8220;spur demand across homes priced at or below IDR5 billion, which we believe account for the majority of domestic demand.&#8221;<\/p>\n<p><span data-contrast=\"auto\">With\u00a0<\/span><span data-contrast=\"auto\">th<\/span><span data-contrast=\"auto\">is<\/span><span data-contrast=\"auto\"> tax break, PT Lippo Karawaci Tbk,\u00a0SouthCity, and PT Mitra Usaha Perkasa (Badak Perkasa Group) &#8212; major titleholders at the 2020 <a href=\"https:\/\/www.asiapropertyawards.com\/en\/award\/indonesia-property-awards-2021\/indonesia-property-awards2020\/\" target=\"_blank\" rel=\"noopener\">PropertyGuru Indonesia Property Awards<\/a> &#8212; and other <\/span><span data-contrast=\"auto\">developers\u00a0<\/span><span data-contrast=\"auto\">of affordable and low-cost<\/span><span data-contrast=\"auto\">\u00a0<\/span><span data-contrast=\"auto\">housing in the country <\/span><span data-contrast=\"auto\">were able to breathe a sigh of relief<\/span><span data-contrast=\"auto\">, knowing that this\u00a0<\/span><span data-contrast=\"auto\">measure will\u00a0<\/span><span data-contrast=\"auto\">help them recover from the loss brought by the pandemic.<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335551550&quot;:1,&quot;335551620&quot;:1,&quot;335559740&quot;:276}\">\u00a0<\/span><\/p>\n<p><span data-contrast=\"auto\">According to\u00a0Sri Mulyani, t<\/span><span data-contrast=\"auto\">his is one of the actions within the\u00a0<\/span><span data-contrast=\"auto\">policy package<\/span><span data-contrast=\"auto\">\u00a0that they developed<\/span><span data-contrast=\"auto\">\u00a0with central bank<\/span><span data-contrast=\"auto\">, following the announcement of a luxury tax break on some <\/span><span data-contrast=\"auto\">vehicles<\/span><span data-contrast=\"auto\">. <\/span><span data-contrast=\"auto\">D<\/span><span data-contrast=\"auto\">ownpayment\u00a0<\/span><span data-contrast=\"auto\">requirements<\/span><span data-contrast=\"auto\">\u00a0for\u00a0<\/span><span data-contrast=\"auto\">car\u00a0<\/span><span data-contrast=\"auto\">loans and mortgages\u00a0<\/span><span data-contrast=\"auto\">have already been removed by Bank Indonesia, aside from cutting interest rates, which sums to\u00a0<\/span><span data-contrast=\"auto\">about 150 basis points.<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335551550&quot;:1,&quot;335551620&quot;:1,&quot;335559740&quot;:276}\">\u00a0<\/span><\/p>\n<p><span data-contrast=\"auto\">\u201cThis is to optimise the purchasing power of the middle class&#8230; and to boost confidence so they start to consume,\u201d she explained.<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335551550&quot;:1,&quot;335551620&quot;:1,&quot;335559740&quot;:276}\">\u00a0<\/span><\/p>\n<p>From 1 March to 31 December 2021, Bank Indonesia also eased the minimum downpayment for home loans to 0 percent, from the already modest 5 to 15 percent requirement. Fitch Ratings explained that this decision will enable banks to dispense the complete loan value upfront, which will have less impact instead of throughout the period of construction.<\/p>\n<p><a href=\"https:\/\/www.asiapropertyawards.com\/en\/pandemic-halts-indonesias-omnibus-law-designed-to-revive-the-real-estate-market\/\" target=\"_blank\" rel=\"noopener\"><strong>More: Pandemic halts Indonesia\u2019s Omnibus Law designed to revive the real estate market<\/strong><\/a><\/p>\n<p><span data-contrast=\"auto\">Airlangga Hartarto, coordinating minister of economic affairs, said the measures introduced could propel the growth of the economy by 0.9 to 1 percentage point. For 2021, the<\/span><span data-contrast=\"auto\">\u00a0authorities aim for a 5 percent growth from a 2.07 percent GDP slump in 2020.<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335551550&quot;:1,&quot;335551620&quot;:1,&quot;335559740&quot;:276}\">\u00a0<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335551550&quot;:1,&quot;335551620&quot;:1,&quot;335559740&quot;:276}\">\u00a0<\/span><\/p>\n<p><span data-contrast=\"auto\">The real estate sector\u2019s tax incentive will cost the government IDR5 trillion<\/span><span data-contrast=\"auto\">,<\/span><span data-contrast=\"auto\">\u00a0whilst the vehicle tax breaks will cost them IDR2.99 trillion,<\/span><span data-contrast=\"auto\">\u00a0revealed Sri Mulyani.<\/span><span data-contrast=\"auto\">\u00a0<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335551550&quot;:1,&quot;335551620&quot;:1,&quot;335559740&quot;:276}\">\u00a0<\/span><\/p>\n<p><span data-contrast=\"auto\">The\u00a0<\/span><span data-contrast=\"auto\">latest budget for the National Economic Recovery has reached IDR699.43 trillion, twice more than what<\/span><span data-contrast=\"auto\">\u00a0the government primarily designated<\/span><span data-contrast=\"auto\">, given the fact that they have increased the budget many times this year<\/span><span data-contrast=\"auto\">.<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335551550&quot;:1,&quot;335551620&quot;:1,&quot;335559740&quot;:276}\">\u00a0<\/span><\/p>\n<p><strong><i>Know of any award-worthy homes, condos, flats, or other real estate projects in\u00a0<\/i><i>Indonesia<\/i><i>? Nominate them for the\u00a0<\/i><i>2021<\/i><i>\u00a0<\/i><i>Indonesia\u00a0<\/i><i>Property Awards<\/i><i>\u00a0<\/i><i>on or before<\/i><i>\u00a0<\/i><i>6<\/i><i>\u00a0<\/i><i>August<\/i><i>\u00a0<\/i><i>202<\/i><i>1<\/i><i>. Simply visit <\/i><a href=\"https:\/\/www.asiapropertyawards.com\/en\/award\/indonesia-property-awards-2021\/\" target=\"_blank\" rel=\"noopener\"><i>asiapropertyawards.com\/en\/award\/indonesia-property-awards\/<\/i><\/a><i>\u00a0<\/i><i>for more details.<\/i>\u00a0<\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"<p>The Finance Minister believes that a temporary tax break on homes for sale will \u201coptimise the purchasing power of the middle class\u201d<\/p>\n","protected":false},"author":9,"featured_media":21070,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"inline_featured_image":false,"footnotes":""},"categories":[101,92],"tags":[889,154,644,164,638],"class_list":["post-11480","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-asia-property-awards","category-news","tag-home-sales","tag-indonesia","tag-private-residential","tag-property-tax","tag-real-estate","news_country-indonesia","news_author-gynen-kyra-toriano"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.8 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Indonesian government bets on middle class to boost home sales and revive pandemic-hit economy | Asia Property Awards<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" 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