New Law Solves Omnibus Glitch, E-Commerce Law Tweak Upcoming, Covid Positivity Rate Moves Out of WTO Safe Zone
Jun 20, 2022
Jokowi Signs Regulation on Omnibus Law Glitch
President Joko Widodo has officially signed Law 13/2022, the second revision to Law 12/2011 on the Formation of Laws and Regulations (PPP), which was previously used as the basis of the Constitutional Court’s ruling that the Omnibus Job Creation Law could not be implemented.
Corresponding to the ruling, the revised regulation includes new rules on lawmaking using the Omnibus method, as stipulated in Article 42A. In cases where there is a technical error in draft regulations agreed upon by the House of Representatives (DPR) and submitted to the President, relevant ministries along with the Ministry of State Secretariat and the DPR are allowed to make a revision. With the establishment of the law, the previously “procedurally unconstitutional” Job Creation Law can be rectified and implemented.
The government is refining the regulation for e-commerce platforms under Minister of Trade Regulation 50/2020. Director General of Domestic Trade Oke Nurwan said the revisions will be finished next week, and adds provisions to strengthen the role of micro, small and medium-sized enterprises (MSMEs). The government says the new regulation will create equality for business actors, as there are fraudulent practices found in online trading such as predatory pricing to harm competition, merchants and consumers.
The government also plans to apply stamp duty on various digital platforms, including e-commerce. Customers who e-shop will be subject to stamp duty of Rp 10,000 if the purchase transaction exceeds Rp 5 million, in accordance with Article 3 paragraph (2) of Law 10/2020 concerning Stamp Duty. However, head of the Fiscal Policy Agency of the Ministry of Finance Febrio Kacaribu said the imposition of stamp duty on e-commerce would not interfere with the digital ecosystem and community because it is not a new type of tax.
Jakarta Hits 7.2% Positivity Rate, 11.5% Nationally
The positivity rate of Covid-19 cases in Jakarta is now 7.2 percent, surpassing the safe zone rate set by the World Health Organization of no more than 5 percent. Yesterday, June 19, Jakarta contributed 735 out of 1,167 national daily cases. Head of Disease Prevention and Control of the Jakarta Provincial Government Health Office Dwi Oktavia said the total percentage of positive cases for the whole of Indonesia was 11.5 percent, and that society should be alert to the development of cases triggered by the BA.4 and BA.5 sub variants as their transmission rate is faster than for previous variants.
Covid-Related Tax Incentives to be Removed at Year-End
The government has said many of the tax incentives implemented during the pandemic will be phased out by the end of the year, citing GDP growth of 5.01 percent and a decline in the unemployment rate to 5.83 percent from 6.26 percent during the same period last year. The move is part of the government's fiscal consolidation efforts in reducing the State Revenue and Expenditure Budget (APBN) deficit in 2023 to below 3 percent.
Some incentives have been extended until the end of 2022 to help businesses face the economic impacts of the pandemic and accelerate economic recovery, such as the reduced corporate income tax rate of 22 percent, tax exemption for small businesses with annual sales below Rp 500 billion, along with faster tax restitution.
Giving back and contributing to the community are two of life's most fundamental values, and Map Boga Adiperkasa (MBA) is no exception.
Starbucks, as the first MBA brand, has done a lot of good work for the community, including inviting customers and partners (workers) in Indonesia to participate in the annual Drop of Hope program, which involves sharing and gifting to 700 underprivileged children from the Indonesian Street Children Organization (ISCO) and Yayasan Sahabat Anak by fulfilling their wishes. Supporting youth education programs in the development of "soft skills" on a regular basis in partnership with The Learning Farm (TLF) has now reached Batch 40. Partners also visited many hospitals, organized donations, cleaned beaches, and visited orphanages during the Global Month of Good.
In April this year, Starbucks, Krispy Kreme, Genki Sushi, Pizza Marzano, Cold Stone, Paul, Godiva, and Subway visited several hospitals to share blessings, appreciation, and unlock the love with local heroes – health workers – for their dedication and hard work during a difficult time in the past two years.
Starbucks will continue to share happiness with its community, so the warmth it shares will not stop here.
Y20 Pre-Summit Discusses Education and Creative Economy
The Y20 Pre-Summit held in Manokwari, West Papua, on June 18 highlighted issues on education and creative economy in the context of post-pandemic economic recovery. The economic collapse caused by the pandemic exacerbated difficulties experienced by youth and the shrinking labor market saw low-skilled youth more vulnerable to exploitation, and Indonesian Youth Diplomacy (IYD) recommended solutions such as financial support for youth education, as well as training and certification programs.
The AmCham Office is on the work-from-home status and all face-to-face meetings and events have been postponed. We are having a number of meetings online using the Zoom platform. You will be notified of virtual meetings as they are scheduled.
What is Your Company Doing on COVID-19?
Please let us know what measures your company may be taking in the form of donations and other assistance to help Indonesia during this time of confusion and concern. Contact [email protected] with your news. We would like to publicize the ways that our AmCham companies are pitching in.
Stay safe, call a doctor if you have a high fever, cough, or difficulty breathing. Stay healthy above all else.
AmCham Update is AmCham's regular newsletter on developments related to the pandemic crisis and other issues in Indonesia. It is edited by AmCham Managing Director A Lin Neumann and written by the AmCham Staff. Paul L Goddard is the Managing Editor.