Indonesia Options in Reviewing the Value Added Tax (VAT) System Policy With Estonia as the Most Competitive Country in the World
DOI:
https://doi.org/10.59890/ijma.v4i1.252Keywords:
Value Added Tax, Tax System, Indonesia Country, Estonia CountryAbstract
There are several types of taxes in Indonesia and Estonia, one of which is VAT. In 2025, Indonesian government increased the VAT rate to 12% specifically for the luxury goods category, while the VAT rate for non-luxury goods remains at 11%. The VAT increase aims to increase state revenue in the long term it can support development and encourage economic recovery. Meanwhile, in Estonia, the current VAT rate is 22% and is planned to increase in early 2026 to 24%. If state revenue continues to improve or even exceeds expectations, the government plans to strengthen the budget for defense spending or reduce the burden of personal income tax. This study aims to analyze the implementation of the applicable taxation systems in both countries. The research method uses a qualitative approach that involves a systematic literature review through a data on the internet to obtain references, journals, articles, or legal-based information related to the research object. The research results show that there are differences in the implementation of the taxation system as well as the impacts and challenges faced by the two countries in implementing VAT.
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