By Marchio Irfan Gorbiano
The Jakarta Post
In its first move to enhance the ease of doing business (EODB) in Indonesia this year, the government plans to launch an online integrated business licensing system in March.
To implement the system, called Single Submission, the government will deploy several task forces to process business permits and supervise the application of licensing checklists at special economic zones (SEZ) and free trade zones (FTZ) through data sharing.
Coordinating Economic Minister Darmin Nasution said task forces would also be in charge of a wide range of functions pertaining to business licensing procedures, from supervising to problem solving.
They will be available in the regional level as well as the national level, and support the one-stop integrated service under the authority of the Investment Coordinating Board (BKPM).
“Our target is to establish all task forces and see them work by the end of February,” Darmin said after a coordination meeting at his office on Wednesday.
Making it easier for businesses to operate in Indonesia is among the key concerns of President Joko “Jokowi” Widodo, who made the target of pushing the country into the top 40 list of the World Bank’s 2018 EODB ranking.
Late last year, however, the global lender placed Southeast Asia’s largest economy in 72nd position out of 190 countries.
The archipelago had managed to climb from its previous ranking at 91st place, but is still lagging behind its Southeast Asian peers, such as Thailand (26th) and Vietnam (68th) place.
The notorious red tape of Indonesian bureaucracy is one of the major obstacles business people must grapple with, forcing them to spend days merely to register their businesses, as they are required to deal with multiple institutions to secure many operational permits.
In addition, Indonesia also performed low in the ease of paying taxes, with entrepreneurs needing to spend around 207.5 hours per year to complete the forms required for paying their taxes.
The Finance Ministry is working on ways to ease the process of paying taxes for businesses, especially small and medium enterprises (SMEs), Finance Ministry Sri Mulyani said after Wednesday’s meeting.
She added that it would also form a task force to help SMEs in dealing with tax authorities.
Darmin further said the government was also trying to address the complex red tape in priority sectors such as logistics and transportation to smoothen business transactions in the country.
In addition to creating a system to better serve businesses, the government is also identidfying past investments, the realization of which met a number of stumbling blocks.
“We have identified investments that were committed prior to the issuance of the Perpres [President Regulation], but have yet to be realized,” he said, referring to Perpres No.91/2017 on the acceleration of doing business.
“Consequently, we can understand existing problems, as well as find solutions.”
According to data from the Office of the Coordinating Economic Minister, 190 investment projects were in the pipeline during the 2010-2017 period, but none have been realized.
Of the total, domestic investment amounted to Rp351.19 trilion (US$261.63 billion), while foreign investment settled at $54.6 billion.
Edy Putra Irawady, a special staffer for the coordinating economic minister, said the government would also continue to widen the coverage of its one-stop integrated service at the regional level.
It would commence a trial period of the service in three regions, namely Purwakarta in West Java, Palu in Central Sulawesi and Batam in Riau Islands in the second week of January.
Source: The Jakarta Post
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