The Pajak Pertambahan Nilai (PPN) is Indonesia's version of the Value-Added Tax (VAT), managed by the Directorate General of Taxes (Direktorat Jenderal Pajak) under the Ministry of Finance. The current Minister of Finance, Sri Mulyani Indrawati, oversees this tax policy as part of the country's broader fiscal strategy. VAT is a consumption tax applied at every stage of production and distribution, with businesses collecting the tax from consumers and remitting it to the government. In 2022, the VAT rate was increased from 10% to 12% to strengthen government revenues, particularly for funding public infrastructure, healthcare, education, and other essential services. The Ministry of Finance argued that the increase would enhance Indonesia's development capacity and improve public service delivery.
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