Indonesia: Tax and customs relief measures (COVID-19)

Indonesia: Tax and customs relief measures (COVID-19)

The government in Indonesia introduced further guidance relating to tax relief measures in response to the coronavirus (COVID-19) pandemic.


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A regulation also addresses the tax treatment of e-commerce transactions.

COVID-19 tax relief

The Ministry of Finance previously announced tax relief measures for companies and individual taxpayers in Regulation No.23/PMK.03/2020. Read TaxNewsFlash

Regulation No. 1 for 2020 (PERPPU-1)—effective 31 March 2020—includes a reduction of the corporate tax rate beginning for the fiscal year 2020-2021. The due dates for compliance with certain tax rights and obligations pursuant to the “COVID-19 force majeure period” are also extended.

These regulation further extends the authority of the Minister of Finance to grant import customs duty exemptions (or reductions) relating to the COVID-19 pandemic.

Tax treatment of e-commerce transactions

Regulation No. 1 for 2020 (PERPPU-1) also addresses the tax treatment of activities conducted as e-commerce transactions. Overseas sellers and e-commerce platform providers are required to appoint a representative in Indonesia to be responsible for paying and reporting the taxes related to these transactions.

Other measures provide:

  • Value added tax (VAT) on the import of intangible goods and taxable services is to be collected by foreign sellers, foreign service providers, and/or foreign or local e-commerce platforms.
  • Corporate income tax liability is related to deeming a permanent establishment (PE) of an overseas e-commerce company that has a significant economic presence in Indonesia.
  • If a “deemed PE” cannot be accomplished because of available tax treaty provisions, an “electronic” transaction tax is to be imposed on sales to Indonesian buyers or users.

Read an April 2020 report [PDF 835 KB] prepared by the KPMG member firm in Indonesia

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