Indonesia to tighten corporate debt financing rules

JAKARTA: Indonesia’s finance ministry plans to tighten a tax regulation to ensure firms' have sufficient cash buffers against the amount of debt they take in a bid to better manage their foreign debt exposure and boost the government's tax revenue.

Finance Minister Bambang Brodjonegoro (pic) told a press conference yesterday that the government will only recognise interest payments as tax deductible if a firm's debt-to-equity ratio is not more than 4 to 1.