Depok, June 24, 2024 – Plastic remains an essential material for society. Plastic waste is projected to reach 9.9 million tons by 2025. The 3R concept (Reduce, Reuse, Recycling) is a policy adopted by many countries, including Indonesia, to manage plastic waste. Within this framework, the plastic recycling industry (IDUP) plays a crucial role in processing plastic waste.

“Currently, IDUP’s capacity to recycle plastic waste is approximately 7% or about 810,000 tons, and this needs to be increased to meet the ENDC and SDGs targets through the provision of fiscal incentives,” said Dr. Andang Wirawan Setiabudi during his doctoral promotion session in Administrative Science at the Graduate Program of the Faculty of Administrative Sciences, University of Indonesia, on Monday (06/25/2024) at the EDISI 2020 Auditorium, FIA UI Building. Dr. Andang’s dissertation is titled “Fiscal Policy Design for the Plastic Waste Recycling Industry to Encourage Sustainable Plastic Production and Consumption.”

Amid the growing global challenge of the plastic waste crisis, this research focuses on the implementation of the 3R concept as a primary approach to managing plastic waste in Indonesia. The plastic recycling industry (IDUP) is highlighted as a key solution to reducing the environmental impact of plastic waste.

Using a qualitative approach with a post-positivism paradigm, the research involves in-depth interviews, literature studies, and observations to analyze how fiscal policies can effectively enhance IDUP’s capacity.

“The findings indicate that fiscal incentives such as direct subsidies for plastic waste sorting costs, super tax deductions, tax holidays, specific regulations for IDUP, relevant plastic excise taxes, and government-borne Value-Added Tax (VAT) facilities on recycled plastic resin can significantly boost the growth of this industry,” he explained.

A comparative study with similar policies in countries such as Thailand, Germany, South Korea, and Malaysia also reveals that a combination of incentives and disincentives (taxing) has proven effective in increasing national plastic recycling capacity.

“Appropriate fiscal policies can serve as a powerful driver for enhancing IDUP’s capacity and steering society toward more sustainable consumption and production patterns,” Andang Wirawan Setiabudi asserted.

Based on his research findings, Dr. Andang also recommends enhancing the collaboration between fiscal policies and other public policies, revising the regulatory framework for fiscal incentives, and accelerating the implementation of taxing and incentive policies.

“These recommendations aim to provide a foundation for the government and other stakeholders to formulate and implement effective fiscal policies to support the plastic recycling industry in Indonesia. This is expected to reduce the environmental impact of plastic waste and promote more sustainable consumption and production patterns,” he concluded.

During the doctoral promotion session, Dr. Andang Wirawan Setiabudi became the 43rd doctoral graduate from the Faculty of Administrative Sciences and the 231st in Administrative Science, earning the distinction of “With High Honors.”

The doctoral promotion session was chaired by Prof. Dr. Amy Yayuk Sri Rahayu, M.Si, with Prof. Dr. Gunadi, M.Sc., Ak. serving as the promoter and Prof. Dr. Haula Rosdiana, M.Si. as the co-promoter. The examination panel included Dr. Machfud Sidik, M.Sc.; Dr. Ning Rahayu, M.Si.; Dr. Titi Muswati Putranti, M.Si.; Dr. Milla Sepliana Setyowati, M.Ak.; and Dr. Inayati, M.Si.