Fiscal Incentives And Disincentives To Reduce Plastic Waste In Indonesia

Abstract

Indonesia's growing economy causes plastic usage to increase. Consequently, the volume of plastic waste continues to increase over time. In 2015, Indonesia is the second country that pollutes the sea with plastic garbage after China (Jambeck, 2015). The Government of Indonesia is committed to reducing the volume of plastic waste by 30% in 2025, but until now the progress has not been satisfactory. The current development of plastic technology has found environmentally friendly plastic, namely biodegradable plastic which can degrade in a shorter period of time. Technology improvements are still continuing, but there are already visible problems that will become an obstacle, the price of bio-degradable plastics is more expensive than that of non-degradable plastic. People tend to choose non-degradable plastic that is cheap, and avoids biodegradable plastic that is expensive. This study aims to find alternatives of fiscal policies to reduce the volume of plastic waste. This study uses explorative descriptive methodology, in the form of description and explanation of the phenomena that occur in the progress of plastic consumption and production. This study concludes that the combination of incentive and disincentive fiscal policies can be applied to reduce the volume of plastic waste. Fiscal incentives (subsidies) policy can be applied to increase the use of biodegradable plastic and fiscal disincentives (excise) policy can be applied to reduce the use of non-degradable plastic. These policies will not burden the government, will make the plastic waste be degraded faster, and the volume of plastic waste will be reduced significantly.