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Indonesia Offers More Aggressive Tax Perks for Electric Cars

  • Luxury tax for EVs to stay at 0%, higher rates set for hybrids
  • Southeast Asia’s largest car market sold only 120 EVs in 2020
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Indonesia, a top supplier of a key battery metal, will aim to boost sales of electric vehicles with a new regulation that will cut tax breaks for hybrid cars.

Battery-powered electric vehicles will retain their 0% luxury tax rate, while plug-in hybrid vehicles will see their tariff increase to 5% from 0%, according to a draft regulation issued by the finance ministry on Monday. Full and mild hybrid types will be taxed at a rate of 6%-12%, compared with a previous range of 2%-12%.