Government’s plan to revise regulations No. 52/2000 on Telecommunication and No.53/2000 on Use of Spectrum of Radio Frequency and Satellite still stir a debate. Deputy Chairperson of Parliamentary Commission, Hanafi Rais, has asked the government to postpone the revisions as these are considered contradicting Law. No 36/1999 on Telecommunication.
“No revision, we want to encourage a new Telecommunication Law, including convergence,” he said in the seminar “Liberalisation of Telecommunication: Dominance of Foreign Investment or Economic Independence”, on Monday (24/10) at Faculty of Social and Political Sciences UGM.
In his opinion, such revision would lead to effort for liberalisation that will benefit foreign operators. It is feared that if it is not corrected, it will create an ultra liberal policy.
Executive Director of Center for Indonesia Taxation Analysis (CITA), Yustinus Prastowo, mentioned that the plan to reduce interconnection tariff and network sharing will disadvantage the state. Unhealthy competence can decrease the revenue from the industry that will eventually impact the state revenue.
“The estimated decrease of the revenue from national telecommunication industry is IDR14 trillion,” he said. It means that non-tax state revenue will decrease by 245 billion (1.75%x14 trillion), as well as decrease in VAT at IDR1.4 trillion (1.0%x14 trillion) and income tax IDR3.5 trillion (25%x14 trillion).
Yustinus said the structure with foreign operator ownership may generate transfer pricing practices, so Indonesia would not receive the profits.
Yustinus suggested that revision of the regulation should aim at mobilising the strategic sector of domestic telecommunication industry. Also, a scheme to share active networks for new networks, construction in rural areas, sparsely populated or non-commercial areas to accelerate the target of 100% of broadband coverage.
“The Communication and Information Ministry should establish asymmetrical interconnection prices based on recovery and coverage of each operator by fair calculation,” he said.
UGM’s political observer, Dr. Arie Sujito, said the revision was not in line with the vision launched by President Joko Widodo as it threatens the national telecommunication industry.
“The revision is pro-foreign investors, weakening the President’s Nawacita vision and disadvantage the national telecommunication industry,” he said.
Arie considers that revisions should orientate to build the state independence. He asked the government to involve the public in policy and regulation drafting on issues of society interests. “This is a test to prove the Joko Widodo government is not driven by foreign economic interest,” he said.