I. DESCRIPTION OF INVESTMENT AND THE USE OF FACILITIES

1. Investment or capital investment is a business activity that spends a sum of money for a relatively long period.  The use of facilities in capital investment by PMDN, PMA and other companies can be carried out only if KAPET Bima has granted operational permit.
2. The mentioned facilities include easy processes of permit through one roof service under delegation of authority from the relevant department / institutions / offices, and tax reduction.

II. TYPE OF PERMITS GRANTED BY KAPET BIMA

• For PMDN and PMA in particular, BP. KAPET Bima has been given the task and authority by the Ministry of Investment / Head of BKPM under the decree No. 22 / SK/ 1999, to issue:
• Agreement for domestic investment (SP.PMDN) that operates as temporary operational permit for various types of business.
• Agreement for amendment of domestic investment
• Agreement for extension of domestic investment
• Limited Import Identification Number (APIT) for PMDN.
• Permanent Business Permit (IUT) for various sectors/type of business (for
• PMDN), after BP. KAPET carried out BAP with relevant institutions/offices.
• To evaluate and forward Agreement for Foreign Investment (SP PMA) to the Ministry of Investment / Head of BKPM.

PERMITS AND FACILITES FOR INVESTMENT WITHIN THE VICINITY OF KAPET BIMA

• To legalize the plan for the use foreign workers (RPTKA).
• To provide recommendation (TA 01) for application of limited visa (VITAS) to Directorate General of Immigration.
• To provide recommendation (TA 02) for renewal Limited Stay Permit (KITAS) to the local immigration office.
• Permit for new and renewal work permit for foreign workers.
• To evaluate and forward application for permanent business permit (IUT) for PMA to Meninves/Head of BKPM, after BP. KAPET carried out BAP with relevant institutions/offices.
• To give penalty to companies that disobeys rules and regulations.

III. TYPE OF PERMITS REQUIRED FROM RELEVANT INSTITUTION / OFFICES

After obtaining SP. PMDN or SP PMA, a company should apply for:
Location Permit (if the land area is more than 1 Ha.) to the Head of the Regency (Bupati) through the local Land Office (Kantor Pertanahan).
Agreement from the provincial BAPEDALDA  on environmental impact assessment / AMDAL (if required to do AMDAL).
UKL and UPL documents (if required to do AMDAL).
Land Use Permit (HGB/HGU) from the local  Land Office (Kantor Pertanahan) / provincial BPN.
Establishment Permit (IMB) from the Head of the District through Head of Public Work Office.
Permit on Hinder Ordinance (Undang-undang Gangguan) (if not required to do AMDAL) from Sekwilda.
Recommendation of IKTA renewal from District office of Labor and Employment (Depnaker)
Copies of applications for all permits under no III must be forwarded to BP. KAPET.


IV. TAX FACILITIES

Investors who have obtained operational permits (SP.PMDN, SP.PMA or IUT) from BP.KAPET Bima can be granted the following facilities :

1. I.Four types of income tax incentives given to investors who do business within the area of KAPET Bima i.e:
   • 30 % discount of income gained from invested capital.
   • An option to implement accelerated depresiation and/or amortisation as follow:
     
   • Fiscal loss compensation starting from the next fiscal year for maximum of 10 consecutive years.
   • 10 % of income tax over dividen paid to foreign tax subject, or lower tariff  according to  multiple tax exemptions.
2. Value added tax (PPN) owed on import and delivery of taxable goods are payable by the government (decree of President of RI No. 37, 1998).
3. a. Building and land tax to both new and extended objects is reduced by 50% of building and land tax liability accounted since the land permit was issued.
   b. The land and building tax facility is granted only for investments in agriculture, plantation, animal husbandry, fishery, mining, forestry, industry, real estate, tourism, infra structure for economy and land, seas and iar transportation services.
   (Decree of Ministry of Finance RI No. 748/MK.04/1990 dated 28 June 1990)
4. Customs facilities in the form of import duty reduction provided to investors within the authority of Kapet Bima (Decree of Mionistry of Finance RI No. 200/KMK.04/2000 dated 6 Juni 2000) include:
   • Importation of machinery that directly related to industrial activities so that the final import duty is 5 %, but in the case of import duty set in the Indonesian import duty book (BTBMI) at 5 % or less, then the tarrif is as stated in the BTBMI.
   • Importation of goods and materials required for 4 (four) years according to established capacity, for the period of 4 years since the issue of import tax reduction, the final import duty of these goods and materials directly related to industrial activities is 5 %, but in the case of import duty set in the Indonesian import duty book (BTBMI) at 5 % then the tariff is as stated in the BTBMI.