The Berau Regency Government (Pemkab) along with the Berau Regency Regional House of Representatives (DPRD) are currently drafting a revision of the Regional Regulation (Perda) on Regional Taxes and Retributions. One crucial point in this revision is the plan to slash the upper limit of the entertainment tax rate from the initial 75 percent to a maximum of 40 percent.
This rate adjustment is being made in response to the dynamics of national regulations and evaluations from the central government. Head of Operations of the Berau Regional Revenue Agency (Bapenda), Harlina, explained that this change refers to Law Number 1 of 2022 concerning Financial Relations between the Central Government and Regional Governments (UU HKPD).
In addition to central-level regulatory adjustments, this policy is also driven by the aspirations of the entertainment business association in Berau, which has complained about the high tax burden. Through a circular from the relevant ministry, regional governments now have the regulatory room to provide relief in the form of fiscal incentives to maintain a favorable business climate.
However, Harlina emphasized that this tax rate reduction to the 40 percent range does not apply to all entertainment sectors. The rate relaxation is specifically targeted only at sectors previously subject to the highest rates, such as karaoke venues, nightclubs, discotheques, and similar types of entertainment.
