Indonesia's Double Taxation Agreement and China-Indonesia Taxation Agreement丨Indonesia Tax Guide 2025 (51)-熊猫出海

Indonesia's Double Taxation Agreement and China-Indonesia Taxation Agreement丨Indonesia Tax Guide 2025 (51)

China-Indonesia Tax Agreement Indonesia Double Taxation Treaty 2025-03-26 09:09:24 Page view：230

This issue's introduction

Indonesia Double Taxation Agreement and China-Indonesia Taxation Agreement

Chapter 11

China-Indonesia Tax Agreement and Mutual Consultation Procedure

Indonesia Double Taxation Treaty

Currently, Indonesia has signed bilateral tax agreements with 71 countries and regions in the world.

Indonesia's bilateral tax treaties offer benefits such as exemption from withholding tax on service fees and reduction of withholding tax on dividends, interest, royalties and branch profits received from residents of the treaty countries. Among them, the foreign recipient can only enjoy the preferential treatment of exemption from withholding tax on service fees if it does not have a permanent establishment in Indonesia.

(1) In addition, Indonesia has signed tax information exchange agreements with the Bahamas, Bermuda, Guernsey, Isle of Man, Jersey, San Marino and other places.

(2) Indonesia signed the Agreement on Mutual Administrative Assistance in Tax Matters on November 3, 2011, and it was approved on October 17, 2014. Indonesia has signed multinational competent authority agreements to automatically exchange the following information:

① Financial information using common reporting standards;

② Transfer pricing documents provided in the form of country-by-country reports.

(3) Indonesia signed the Multilateral Convention to Implement Tax Treaty-Related Measures to Prevent Base Erosion and Profit Shifting on June 7, 2017, which lists reservations and notifications to be ratified. This tentative text includes 33 tax treaties of Indonesia.

China-Indonesia Tax Agreement

On November 7, 2001, the Chinese government and the Indonesian government signed the Agreement between the Government of the People's Republic of China and the Government of the Republic of Indonesia on the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with Respect to Income (hereinafter referred to as the "China-Indonesia Tax Agreement"), which came into effect on August 25, 2003.

On March 26, 2015, representatives of the two governments signed the Protocol to the China-Indonesia Tax Agreement and the Memorandum of Understanding.

The main part of the China-Indonesia Tax Agreement includes the scope of application of the agreement, the solution to double taxation, non-discriminatory treatment, the mutual consultation procedure between the two countries, and information exchange.

The protocol stipulates that the two countries will exempt each other from value-added tax on aviation enterprises engaged in international transportation in the other country.

The memorandum of understanding lists the financial institutions that can enjoy tax-free treatment on both sides, providing certainty for financial institutions wholly owned by the two governments to obtain tax-free treatment for interest in the other country.

The next issue will continue to be exciting...

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