Client: Fiscal Policy Agency, Ministry of Finance

In 2019, Svara Institute (formerly Presisi Indonesia) and Fiscal Policy Agency (Badan kebijakan Fiskal/BKF) conducted a study on the proposed value added tax of sugar.Indonesian local sugar has long been lacking competitiveness because the price is higher than international sugar price. This was caused by some problems emerging in the sugar cane plantation, which resulted in the scarcity of sugar cane supply for mills. The other problem was in setting the highest retail price which caused a supernormal margin for distributors. The policy of determining value-added tax on sugar final products was considered to help improve the condition of the domestic sugar industry in Indonesia.