While politicians and lawmakers want the people to focus on the seemingly tiny increase of 1%, the actual effect of that increase, because it affects everything else, will be much more than just 1%.

The most convincing part of this is to first consider the price of fuel. Since all if not most will need to be transported, whether directly to customers or to manufacturers as raw materials, this increase will increase everything else, regardless whether the good in question is label as a luxury item or not.

This gets even more complicated since what a luxury good itself is not well defined. What constitute a luxury good? There are goods that seem to be essential but they are in fact luxury. On the other hand, there are goods that seem to be luxury items but they are in fact not.

Even if the luxury goods are well defined, how will the government enforce it? This will even be more complicated since there are literally billions of goods sold in Indonesia.

As the global economy faces uncertainty, and the consumption already is weak, the rise of this tax will most probably make the economy worse than better in Indonesia.