After the government of Indonesia announced that, effective immediately, a tax incentive is offered to those companies that revalue their fixed assets (as part of the government's fifth stimulus package), both fully state-owned utility firm Perusahaan Listrik Negara (PLN) and partially state-owned airline Garuda Indonesia started to prepare proposals for asset revaluation. A revaluation would increase their equity, allowing them to obtain more loans for business expansion.
On Thursday (22/10), the government said the tax that needs to be paid on companies' fixed asset growth will be cut from 10 percent to 3 percent provided the company submits proposals for fixed asset revaluation before the end of the year (in the first half of 2016 the tax will rise to 4 percent, and to 6 percent in the second half of 2016). As such, asset revaluation has become an attractive option.
Ari Askhara, Finance Director at Garuda Indonesia, said the company will start to revalue its assets in November 2015 (particularly the company's land and building assets). Currently, Garuda Indonesia's total assets are worth USD $3.1 billion.
Meanwhile, Bambang Dwiyanto, Senior Corporate Communications Manager at PLN, stated that the company will also conduct a revaluation of its fixed assets, which stood at IDR 600 trillion (approx. USD $44.4 billion) in the third quarter of 2015.