Jakarta – Jakartans are viewing the city administration's future progressive tax scheme for private vehicles with apprehension, saying that it will create an unnecessary burden and be ineffective in tackling the city's traffic problem.
"It will be quite hard financially," Kurniawan, who works for a pharmaceutical company, told The Jakarta Post on Sunday, "Buying a car is one thing, but paying for its tax and maintenance each year is another."
Kurniawan's family owns three cars, each registered under the name of a different family member.
Mirna Lydia, a graphic designer, whose family owns two cars, said that her family has been complaining about the vehicle taxes. "They say they have to pay increasingly high taxes each year," she said.
A new bill issued by the city administration on private vehicle ownership tax stipulates that owners must pay higher taxes on their second and third cars. The amount they have to pay increases progressively, up to 10 percent of the price of the vehicle.
The bill is planned to take effect next year, in hopes of easing the overwhelming number of cars congesting Jakarta's streets.
Jakarta is home to 2 million private cars and over 6 million motorcycles. The city traffic police say every year the number of vehicles flooding the streets rises by 9 percent, dwarfing the expansion of roads, which increases at a rate of just 0.01 percent annually.
Most Jakartans have deemed the tax policy unfair and ineffective. "If the government wants us to refrain from buying more cars and encourage us to use public transport, then they should improve public transportation policies first," Mirna said.
Reza Amirul, who owns one car and whose father owns another, shared a similar point of view. "People would prefer to pay more rather than suffer in Jakarta's traffic," he said.
Other car owners said the law would be ineffective because it contained many loopholes. "People who want to own more than one vehicle but don't want to pay the extra taxes can always register their vehicles in cities outside Jakarta," Mirna said.
Getting around the current legal system should not be difficult, she continued, "When I was getting my taxpayer's number (NPWP), I was only asked how much I had in my bank account, they did not even ask me what my bank was".
Those seeking to dodge the tax scheme, could also register their vehicles under different names. "When the scheme was mentioned a few years ago, someone told me that you could always use someone else's name to register your car," Reza recalled.
Kurniawan said the government was barking up the wrong tree in its effort to settle the capital's notorious traffic problem.
"There are schemes and bodies that make it easy for people to own motorcycles and cars," he said, "Imagine, you can get a motorbike only by paying Rp 500,000 in advance by using credit schemes."
In 2008, more than 600,000 four-wheeled vehicles were sold in the wider metropolitan area, up 40 percent from 2007. As much as 50 percent of these sales were in the greater Jakarta area. (dis)