economy

Tax Incentives Have The Potential To Enhance Growth In The Property Sector In 2025

The property market is projected to experience growth in 2025, following a major reset caused by the pandemic that led to four years of stagnation. Ishak Chandra, the CEO of PT Perintis Triniti Properti Tbk (TRIN), shared these insights during a media event at his Jakarta office on Thursday, November 31, 2024.

Ishak pointed out that property cycles typically occur every 8-10 years and are significantly affected by political events, such as elections. Prior to the pandemic, it was expected that the property sector would thrive in years ending with a 9, like 2009, while years ending with a 4, such as 2014, would see declines.

"Thus, 2019 was anticipated to bring growth in 2020. What happened? The pandemic intervened," Ishak clarified. The pandemic stunted the property sector's progress in 2020, 2021, 2022, and 2023, necessitating a new adaptation for the upcoming 2024 elections.

With the pandemic's impact and the elections behind us, a turnaround in the property cycle is expected, paving the way for growth in 2025. "We hope nothing will obstruct this. If everything proceeds smoothly, property prices should increase," Ishak remarked.

However, this optimistic outlook hinges on government backing through incentives such as Value Added Tax (VAT) and Land and Building Acquisition Duty (BPHTB).

Next year, VAT might rise to 12%, while BPHTB will range from 2.5% to 5%, depending on the region. "Finally, I want to stress the importance of establishing clear regulations regarding foreign ownership," he concluded.

Tag: Ishak Chandra Property Sector Tax Incentives TRIN