The Nusantara Capital Authority (OIKN) has announced a suite of investment incentives for the new capital in East Kalimantan, touted as the most attractive in Indonesia. These incentives, including unprecedented tax holidays and super deduction rates, aim to catalyze economic growth and attract both domestic and international investors.
As part of Indonesia’s ambitious plans to develop its new capital, Nusantara, the government has introduced a range of incentives designed to make investment in the region highly appealing. With tax breaks ranging from 200-350% and extended land use rights, Nusantara is set to become a hotbed for investment, particularly in infrastructure and renewable energy sectors.
Investors in Nusantara can benefit from tax holidays and reductions unprecedented in Indonesia, including 200-350% super deductions for projects like road and school construction, significantly lowering their tax liabilities based on gross income.
Nusantara offers up to 80 years for Building Use Rights (HGB) and 95 years for Business Use Rights (HGU), with possibilities for extensions. This long-term assurance on land use is a major draw for investors.
Despite generous land use rights, the state retains control, ensuring that sovereignty remains with the government through the OIKN. This balance between investor freedom and state oversight is a key feature of Nusantara’s policy.
OIKN’s business entity, Bina Karya, facilitates partnerships between investors and the state, ensuring that investments align with national interests and contribute to the capital’s development goals.
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With significant interest from Middle Eastern countries in renewable energy investments worth USD 5-10 billion, Nusantara is poised to become a leader in sustainable energy development, partnering with international firms like Singapore’s Sembcorp Utilities.
The investment opportunities in Nusantara, Indonesia’s new capital, represent a unique chance to participate in a groundbreaking project. The combination of attractive tax incentives, extended land use rights, and a focus on renewable energy highlights Indonesia’s commitment to innovative and sustainable development. As Nusantara attracts global interest, its success could serve as a model for future urban and economic planning worldwide.
Nusantara, Indonesia’s new capital in East Kalimantan, sets a new standard for investment incentives in the country, with unmatched tax breaks and extended land use rights designed to attract a wide array of investors. With a special focus on infrastructure and renewable energy, backed by significant international interest, Nusantara aims to become a beacon of sustainable development and economic growth in Indonesia.
Source: Antara News, Neraca (2024)
