ANALYSIS OF THE IMPACT OF CHANGES IN VALUE ADDED TAX (VAT) RATES ON THE INDONESIAN ECONOMIC SECTOR

Abstract

The purpose of this study is to analyze the impact of changes in value-added tax (VAT) rates on the Indonesian economic sector and to understand how these changes affect economic growth and consumer behavior. This study uses a quantitative approach with secondary data analysis from national economic reports and surveys involving business actors in various sectors. The regression analysis method is used to measure the relationship between changes in VAT rates and related economic variables such as consumption, investment, and GDP growth. The results of the analysis show that changes in VAT rates have a significant impact on household consumption and investment. Increases in rates tend to reduce people's purchasing power, while decreases in rates can encourage consumption and investment growth in certain sectors. This study provides new insights into the dynamics of VAT rates in the context of the Indonesian economy, as well as their implications for fiscal policy. These findings can be a reference for policymakers in formulating more effective tax strategies to support economic growth.