Indonesia: Offshore e-commerce transactions subject to 10% VAT

Indonesia: Offshore e-commerce transactions

The Ministry of Finance issued a regulation (no. 48/PMK.03/2020) regarding the value added tax (VAT) treatment of certain offshore e-commerce transactions.

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The regulation provides that the use of offshore intangible taxable assets and/or services within Indonesia provided by means of e-commerce is subject to VAT at a rate of 10%.

The list of intangible assets and services subject to the 10% rate of VAT includes:

  • The use or right to use copyrights in the fields of literature, art or scientific work, patents, designs or models, plans, formulae or secret processes, trademarks, or any form of intellectual/industrial property rights or other similar rights
  • The use or right to use industrial, commercial or scientific equipment
  • The use of scientific, technical, industrial or commercial knowledge or information (including the reception or the right to receive images and/or sound recordings distributed to the public through satellite, cable, fiber optics or similar technology and the use or right to use images and/or sound recordings for television or radio that are broadcasted/transmitted via satellite, cable, fiber optics or similar technology) and the use or right to use part or all of the radio communication spectrum
  • The use or right to use motion picture films, films or video tapes for television broadcasts or sound tapes for radio broadcasts
  • The acquisition of all or part of the rights related to the use or granting of intellectual/industrial property rights or other rights
  • The use of intangible taxable assets and/or taxable services also includes the use of digital assets and/ or services

The regulation includes guidelines concerning the appointment of VAT collectors and rules for VAT reporting and payment obligations.


Read a May 2020 report [PDF 1.7 MB] prepared by the KPMG member firm in Indonesia

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