Government Drafts Two Perpres on Investment

The Government, through the Ministry of Investment and Downstreaming/Investment Coordinating Board (“ BKPM ”), will soon update Regulation of the President No. 16 of 2012 (“ Perpres 16/2012 ”) on General Investment Plan (Rencana Umum Penanaman Modal- “ RUPM ”). This regulation will serve as the policy guideline for investment in Indonesia until 2045, setting out the direction and priorities of investment, and serving as a reference for Ministries/Agencies and Regional Governments.

“We are currently in the process of finalizing and harmonizing it, and we target its issuance this year. This is a plan for the next 20 years,” stated the Head of the Legal Bureau of BKPM, Andre Abraham, to Hukumonline.

In addition to BKPM, the Coordinating Ministry for Economic Affairs is also drafting a Draft Regulation of the President (“ RPerpres ”) on Investment Business Sectors (Bidang Usaha Penanaman Modal- “ BUPM ”). This regulation governs the criteria for business sectors that will be granted fiscal incentives, including tax allowance, tax holiday, investment allowance, and super tax deduction.

“So, there are two different Perpres, but their focus remains investment: the main leverage factors of investment, investment policy, and regional economic corridors,” he explained.