Jakarta (VNA) – Indonesia has announced new incentives to encourage sales oflocally-manufactured and imported electric vehicles (EVs), in its latest bid toboost the use of environment-friendlier cars as well as attract investment toits domestic EV industry.

The detailedincentives are a follow-up to a December-announced tax incentives plan for locallymanufactured and imported EVs in the coming years.

Under newrules made public on February 20, Indonesia will remove luxury tax on EVs forthe 2024 fiscal year and import tax until the end of 2025.

The regulations will also lower value-added tax to 1% from11% for EV buyers this year, extending a tax break that had expired at the endof 2023.

The Indonesiangovernment said the incentives are aimed at stimulating domestic demand for EVswhile attracting investment by automakers.

According to Rachmat Kaimuddin, deputy coordinating minister overseeing EVsector development, many EV makers have disclosed their plans to export vehiclesto Indonesia since the government announced its intention to introduceincentives.

Indonesia aims for 600,000 EVs tobe domestically produced by 2030. This figure will be more than 100 times thenumber sold in Indonesia in the first half of 2023. The Southeast Asian nation strives to become a global EVproduction hub, leveraging the country's vast nickel reserves, an importantmaterial for EV batteries./.