VAT taxpayers and scope of tax collection丨Indonesia Tax Guide 2025 (18)
tax guide
Tax Guide
Tax guide
VAT
Investing in Indonesia
2025-02-08 09:31:14
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This issue's introduction
Tax collection scope
Chapter III Value Added Tax
Taxpayer
Individuals, businesses or government agencies that sell taxable goods or services are taxpayers of VAT.
(1) Taxable goods or services used or given away by oneself;
(2) Transfers between head offices or branches;
(3) Transfers of assets that were not originally sold;
(4) Transfers of taxable goods or services that are not related to the main business.
If any of the following conditions are met, the overseas seller, service provider or overseas e-commerce platform and domestic e-commerce platform will be designated as VAT collectors:
(1) The transaction value of Indonesian customers exceeds IDR 600 million in a year or exceeds IDR 50 million in a month;
(2) Its e-commerce platform in Indonesia has more than 12,000 users in 12 months or more than 1,000 users in a month.
Scope of collection
(1) VAT taxpayers provide taxable goods in Indonesia;
(2) Import taxable goods:
(3) VAT taxpayers provide taxable services:
(4) Use of taxable intangible assets located outside Indonesia, including:
① Use or right to use literature, art or science, or patents, designs, models, plans, formulas, secret recipes, trademarks or other assets of similar nature:
② Use or right to use industrial, commercial or scientific equipment;
③ Provide information or knowledge of scientific, commercial, technical or industrial nature;
④ Provide additional support for the use of the above assets;
⑤ Use or right to use film, movies or videos for television or broadcasting;
⑥ Sell part or all of the above assets.
(5) Taxable services used outside Indonesia:
(6) VAT taxpayers export taxable goods;
(7) VAT taxpayers export taxable intangible assets:
(8) VAT taxpayers export taxable services:
(9) There are two types of services subject to VAT when exporting:
① Processing on commission;
② In addition to processing on commission: services incidental or required to the use of tangible current assets consumed overseas (such as repair services); services incidental or required to the use of tangible fixed assets consumed overseas, including consulting, supervision and construction services.
(10) From April 1, 2022, insurance and reinsurance companies must collect, pay and report VAT levied on commissions of insurance agents and insurance brokers;
(11) From May 1, 2023, collateral provided by financial institutions (such as banks and leasing companies) as creditors to buyers will be deemed to be the delivery of taxable goods and subject to VAT.
Goods that are not subject to VAT include:
(1) Minerals mined from natural resources (except coal);
(2) Daily necessities;
(3) Food provided by hotels and restaurants (excluding catering services);
(4) Currency, gold and securities;
(5) Consignment goods.
Services that are not subject to VAT include:
(1) medical, social and religious services;
(2) postal and money transfer services;
(3) banking, insurance and non-banking financial leasing;
(4) educational services;
(5) financial leasing;
(6) arts and entertainment services;
(7) radio and television broadcasting services, except advertising;
(8) public transport services, namely land, sea and domestic air transport;
(9) manpower and recruitment services:
(10) hotel and lodging services:
(11) services provided by the government related to public administration and etiquette requirements;
(12) parking services (effective from April 1, 2010);
(13) public telephone (coin-operated) services (effective from April 1, 2010);
(14) food and catering services (effective from April 1, 2010).
The next issue will continue...