A senior Government Minister from Indonesia has promised to raise the issue of securing agreement on a double taxation deal involving Ireland and the growing Asian powerhouse economy.
The Indonesian Minister of National Development Planning, Prof Bambang Brodjonegoro, said he would raise the issue at Government level. Prof Brodjonegoro is a former Finance Minister in Jakarta.
Speaking at an investment briefing in Dublin, the Planning Minister said: “I will be carrying the message for the need to introduce a double taxation treaty between Indonesia and Ireland to the Finance Ministry,” he told the invited guests at the event which was organised by Asia Matters, Ireland’s Think Tank on Asia. The working lunch was held at PwC headquarters in Dublin.
Prof Bambang Brodjonegoro with Joe Tynan, PwC and Martin Murray, Asia Matters.
Prof Bambang Brodjonegoro with Martin Murray, Asia Matters and Joe Tynan, PwC.
Some of the members and guests at the briefing by the Indonesian Minister of National Development Planning, Prof Bambang Brodjonegoro.
Ireland currently has comprehensive double taxation agreements in place with 74 countries.
PwC Head of Taxation, Joe Tynan, said one challenge facing Irish businesses and companies doing business in Indonesia was the absence of a double taxation treaty. He said talks were progressing at securing a free trade deal between the EU and Indonesia but a double taxation deal between Ireland and Indonesia would assist in developing a stronger trading relationship. Currently, trade between the EU and Indonesia was valued at €41bn and trade between Ireland and Indonesia at €600m, mainly comprising services.
Mr Tynan said the aircraft leasing sector – one in every two leased aircraft globally is through Ireland – was hampered by not having a taxation agreement with Indonesia as its absence demanded a third country was required. “This creates friction in the system,” he added.
Martin Murray, Executive Director, Asia Matters, said one challenge facing business and companies in Ireland hoping to develop opportunities in that growing economy was the lack of awareness of Ireland in Indonesia. Ireland needed to build its brand in Indonesia. “Direct flights would be very helpful but it will take time before we have any direct flights to Indonesia,” he said.
Minister Brodjonegoro was in Dublin to brief Asia Matters members about the requirement by Indonesia for $360bn in infrastructure investment up to next year. He said 37% of infrastructure investment was earmarked from private participation. He said the projects included toll roads, bridges, power plants, railways, education facilities, water supply, waste water treatment, tourist resorts, seaports and airports.
He said transport infrastructure links were vital in Indonesia which boasted `17,000 islands. Two new airports alone were being constructed in the capital, Jakarta.
Indonesia is expected to have a population of 325 million people by 2035, including 216 million people in its middle class.