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Indonesia considers scrapping luxury goods tax on superyachts

Indonesia considers scrapping luxury goods tax on superyachts

Proposals to scrap Indonesia’s luxury goods tax could see more superyachts sailing into Indonesian waters than ever before. The Indonesian government is currently considering plans to do away with the tax in an effort to boost the country’s tourism trade, Indonesia Investments reports.

The move would encourage more foreign tourists to travel to the country and specifically enable the arrival of more foreign cruise ships and luxury yachts into Indonesian waters. Currently the tariff on cruise ships of luxury yachts can be as high as 75% due to their categorisation as luxury goods.

According to Indonesia Investments, the removal of the tax could rocket the country’s annual foreign tourism income, from IDR 3 billion (£160,000) to IDR 6 trillion (£160 million).

Captain Jimmy Blee, of superyacht agency Asia Pacific Superyachts in Indonesia, welcomed the proposal. “If this goes through it will be great news for visiting superyachts and other vessels,” he said.

The agency, along with Indo Yacht Support and The Lighthouse Company, have previously lobbied the Indonesian government to implement policy changes and encourage more superyachts into the country. The Indonesian government, led by president Joko Widodo, has previously pledged to supercharge the country’s tourism industry.

Despite the difficulties, many of the world's biggest superyachts have been spotted in the country, including Hemisphere, the world's largest sailing catamaran.

This is not the first time the country's luxury taxes have been targeted to enable economic growth. In 2015, Widodo scrapped the luxury taxes on a number of goods, including electrical appliances and branded clothing, in an attempt to boost consumption.

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