Justice and Human Rights Minister Yasonna Laoly. (JG Photo/Nur Yasmin)

Gov't to Submit Job Creation, Taxation Bills in January


DECEMBER 27, 2019

Jakarta. The government will submit the job creation and taxation bills to the House of Representatives next month, the Justice and Human Rights Minister Yasonna Laoly said on Friday, to kick off reform efforts aiming at improving the investment climate in the country.

The bills are drafts of the so-called omnibus laws, which would revise hundreds of existing rules and regulations deemed hindering investment and economic activities. 

President Joko "Jokowi" Widodo bet all his political capital on the bills, going as far as accommodating political rivals in his second term cabinet to secure a super-majority at the House necessary for passing the laws. Observers noted that it was essential for the government to pass the laws in the first few months next year to maintain investors' confidence in the government's reform commitment. 

Before submitting the draft, Yasonna said he would try to communicate and lobby the House to make the bill a top priority and to get a mutual agreement to complete the discussion as early as possible, six months at the longest.

“We expect the House's discussion on the omnibus bill will take no longer than one semester, while at the same time we also acknowledge and understand the many numbers of laws and the width of scope within this bill,” Yasonna said at his office in Jakarta on Friday.

The bill seeks to 74 existing laws in one fell swoop, with the primary goal to eliminate bureaucratic red tapes that persist in many areas – from taxation and business licensing to land issues and local government autonomy.

Yasonna said the President had asked his team to visit several areas in Indonesia to communicate and educate people about the bill, to create understanding and to avoid misconception.

In regards to the job creation bill, Yasonna said the primary consideration is to make a creative and radical invention through the law to create job opportunities.

“It is designed to create as many job opportunities as possible and to promote the growth of small and medium enterprises (SME) as well as the growth of investment,” Yasonna said.

The job creation bill would resolve 11 big issues, including simplification of the licensing and investment requirements and changes in legal arrangements to prioritize civil law over criminal law in business-related disputes. 

The taxation bill addressed the territorial issues in Indonesia taxation that makes it unable to tax over the top services like media streaming company Netflix. The bill would also provide generous tax incentives for individual and institutional investors alike.