JAKARTA: Toyota and Hyundai ready to involve in low-cost car production only if the government clarify the incentives and standards for vehicle specifications to suit local market conditions.PT Toyota Astra Motors Director of Marketing Joko Trisanyoto stated, to date, the regulation on the matter is unclear so that it has to wait for the process particularly on matters related to fiscal incentive and product specification.The Association of Indonesia Automotive Industries (Gaikindo), he continued, has been actively involved on the in the preparation of the program however any decision had not yet issued.Similar statement also expressed by PT Hyundai Mobil Indonesias President Director Jongkie D. Sugiarto stated low-cost car program is quite prospective as long as the government clarifies the form of incentives and production feasibility.During this time, he said, it also represents Gaikindo to discuss with the government so the program could be realizedAwhile ago, Deputy Minister of Economy on Industry and Trade Edy Putra Irawadi stated the regulation will be issued this year. Nevertheless, it still needs to be discussed with several ministries and inter-sectoral coordination.Low-cost car is a way to reduce import independency and to subsidize transportation. That is why it has to be supported with comprehensive regulations including fiscal facility especially customs duties and VAT.Cheap car, he explained, consist of IV cluster car that is planned to produce this year with a price of IDR30 million-IDR40 million and UDR80 million for low-cost car.Cut taxSugiarto suggested the government to decline motor vehicle tax if it wants to run low-cost car program. Automobile manufacturers also need to press their profit thus, the selling price of motor vehicles will automatically be suppressed.In his opinion, by declining motor vehicle tax is not necessarily meant state income from the automotive tax sector will go down, it can be improved.If production volume and sales increase, revenue might go up as well.The selling price of IDR80 million per unit, he added, could be realize if car base price is at US$100 million per unit, and then government cut tax while sole agent reduce its profit by IDR10 million for every unit. (Herry Suhendra) (t05/msw)

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