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This report serves as an update to FAS Jakarta’s previous report outlining Indonesia’s plans to impose a 12-percent value-added tax (VAT) for luxury agricultural products (please see GAIN Report ID2024-0053).
On November 18, 2024, the Government of Indonesia (GOI) issued Regulation No. 19/2024 on the Supervision of Genetically Engineered Food which updates the labeling requirements for genetically engineered (GE) products, and regulates microbial biotechnology, genome editing, and the food safety assessment of products with stacked genes
On December 16, 2024, the Government of Indonesia (GOI) announced the increase in value-added tax (VAT) from the current 11 percent to 12 percent on selected goods and services, effective January 1, 2025. In addition, a separate 12 percent luxury goods sales tax will newly be applied for luxury products intended for high-end Indonesian consumers (luxury VAT).
In 2022, Indonesia maintained its biodiesel blending mandate at 30 percent and raised its biodiesel allocation volume to a record 10.1 billion liters on expected increased economic activity and mobility following eased pandemic-related restrictions. The export levy that funds the subsidies underwriting the biodiesel mandate program was adjusted to also subsidize cooking oil prices which have surged since late 2021.
Wheat imports for 2021/22 are revised upward to 11.2 million metric tons (MMT) from the previous estimate of 11.0 MMT, reflecting recovering demand for flour-based foods. In line with increased imports, food, seed, and industry (FSI) wheat consumption is also revised up 2.2 percent to 9.1 MMT of wheat equivalent.
In 2021, the total value of all food and beverage retail sales in Indonesia totaled $72 billion, a 12 percent decrease from the previous year due to COVID-19 pandemic social distancing measures. Traditional markets still dominate the retail food and beverage sector, accounting for 76 percent of market share, although they continue to lose market share to modern retail stores and e-commerce.