On 4 December 2015, the Indonesian Coordinating Minister for Economic Affairs announced the government will reduce by half the income tax for all workers earning annually less than 50 million IDR (ca. 3'700 USD) and occpupiedin labour-intensive industries. Two of the conditions for the tax relief are that the company involved hires at least 5'000 Indonesian employees and at least half of its produced goods are to be exported.
The industries affected by the scheme include textiles, footwear and tobacco. However, the Minister did not provide an exact list of sectors.
The scheme was introduced on 1 January 2016 for two years with an optional extension. It is part of a seventh stimulus package since September 2015.
A state measure in the GTA database is assessed solely in terms of the extent to which its implementation affects the extent of discrimination against foreign commercial interests. On this metric, the state aid proposed here is discriminatory.