Jakarta (ANTARA News) - The Finance Ministry is mulling the idea of providing tax holidays to attract more investment, a senior tax official said.

"The finance minister has set up a team of officials. The team is working right now," Director General of Taxation Mochamad Tjiptardjo said after an Idul Fitri gathering at the Finance Ministry building here on Tuesday.

The model of the tax holiday would be known after the team had completed their study, he said.

"This has to do with the effort to harmonize the investment law with the income tax law. The team is still studying the appropriate model of tax holiday," he said.

Asked when exactly the tax holiday would be introduced, he said ideally, it would be given starting January 1 next year.

"The team is working now. Hopefully, they could complete their jobs earlier than scheduled," he said.

Actually, the government had provided many tax facilities to boost the business world, he said.

"Under the investment law, only one facility, namely tax holiday has not been provided. The others have been made available, including reduced tax rates, accelerated tax refunds and reduced tariffs," he said.

The tax holiday was not set forth in the tax law but in the investment law and therefore, the two laws must be harmonized, he said.

Tax holiday means exempting taxpayers from the obligation tax within a certain period of time. Normally tax holiday is given as a fiscal stimulus to attract more foreign investors.(*)

Editor: Ruslan Burhani

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