lifestyle

Clothing May Be Subject To A 12 Percent VAT, Leading Consumers To Shift Towards Local Brands And Thrifting

The implementation of a 12 percent Value Added Tax (VAT) on various goods and services starting January 1, 2025, is expected to have significant repercussions across multiple industries. One sector that may be particularly affected is the clothing and fashion industry. This situation has raised concerns among many individuals, including a high school student named Bella (17 years old). As she is still in school, her clothing purchases are made by saving her allowance. "I am honestly worried because I am still in high school, so I have to stick to a student budget," she expressed to Kompas.com at Pasar Baru, Central Jakarta, on Thursday, December 19, 2024. 

To adapt to the impending price increases, many consumers are opting to switch to more affordable brands. For instance, Pratama (21 years old) plans to prioritize shopping for local brands, which tend to be more budget-friendly. "I have actually been using local brands from the beginning, and they are inexpensive. So I feel secure and do not need to change brands, as I believe the price increase will not be too significant for local brands," he stated to Kompas.com in Central Jakarta on Thursday. Meanwhile, another alternative is to explore second-hand clothing, commonly referred to as thrifting. This approach is exemplified by a university student named Angel (20 years old). "With the tax increase, I am looking for other options, such as thrifting, because I can usually find stylish items at affordable prices," she explained. 

Switching to more affordable brands does not seem to pose a challenge for some members of the community. For example, Irene (20 years old) does not prioritize brand names when shopping for clothes. "I do not focus on the brand when buying clothes; I look for the material and the price that fits my budget," she remarked. 

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Tag: Local Brands Thrifting Value Added Tax