Indonesia issues guidance for collecting VAT on the delivery of LPG

International Tax Review is part of Legal Benchmarking Limited, 1-2 Paris Garden, London, SE1 8ND

Copyright © Legal Benchmarking Limited and its affiliated companies 2025

Accessibility | Terms of Use | Privacy Policy | Modern Slavery Statement

Indonesia issues guidance for collecting VAT on the delivery of LPG

Sponsored by

sponsored-firms-gnv.png
The government shall bear the VAT on the delivery of certain LPG

From COVID-19 recovery plans to VAT guidance, I Dewa Made Agung Nugraha and Dwipa Abimanyu Dewantara of GNV Consulting summarise the tax-related developments from early 2021 in Indonesia.

VAT on the delivery of liquefied petroleum gas

The Ministry of Finance (MoF) issued Regulation No. 220/PMK.03/2020 on December 28 2020, regarding the procedures for calculating and collecting VAT on the delivery of certain liquefied petroleum gas (LPG). The regulation has been effective starting from that date.

 

The regulation governs the following points:

1. The delivery of certain LPG by a taxable entrepreneur is subject to VAT;
2. The government shall bear the VAT on the delivery of certain LPG for the portion of price subsidised by the government;
3. The buyer shall be liable to pay VAT on the delivery of certain LPG for the portion of the price that is not subsidised by the government.
The VAT payable is 10% from the VAT base. The treatment of the input VAT related to the delivery of certain LPG shall be as follows:

  • For a company with a LPG business license a input VAT can be credited;

  • For a LPG agent and sub-agent a input VAT cannot be credited.

Tax facilities impacted by COVID-19

The MoF has issued Regulation No. 239/PMK.03/2020 regarding the tax facilities for goods and services required in the handling of the COVID-19 pandemic.

The key changes are as follows:

  • PMK-239 adds VAT facilities for supporting equipment used in the vaccination programme and other supporting services;

  • Letters of recommendation for the pharmaceutical Industry for the production of vaccines and/or medicines, previously issued by the National Disaster Management Agency (BNBP), will be issued by the Ministry of Health;

  • Tax facilities for VAT, Article 22 Income Tax, and Article 23 Income Tax are effective for January 2021 to December 2021 tax periods;

  • Tax facilities for Article 22 Income Tax and Article 23 Income Tax, which require a tax exemption certificate, are effective from the issuance date of the tax exemption certificate until December 31 2021;

    • The following income tax reliefs for handling COVID-19, as stipulated in Government Regulation No. 29 of 2020, are extended from January 1 2021 until June 30 2021:· Additional deduction for taxpayers producing certain medicalequipment and/or household health supplies;

    • Additional deduction for donations to certain institutions;

    • Final income tax rate of 0% for qualifying individuals providing health services; and

    • Final income tax rate of 0% on compensation for the use of assets to support health services; and

  • The tax relief for share buy-backs by taxpayers listed on the Indonesian Stock Exchange is not extended per PMK-239, which has been effective starting from January 1 2021.

Unified income tax returns

On December 28 2020, the Directorate General of Taxes (DGT) issued Regulation No. PER-23/PJ/2020, regarding forms and procedures for the production of unified proof of withholding/collection and form, content, and procedures for filling in and submission of unified income tax returns.

1.   Unified periodic income tax return is a periodic tax return used by a withholding tax (WHT) collector to report the withholding obligation and/or collection of WHT, deposits for withholding and/or collection of income tax, and/or self-payment of several types of income tax in one tax period;

2.   Documents unified proof of withholding/collection are documents in the form of paper forms or electronic documents containing data or information on withholding or collection of certain income tax;

3.   Corrected unified proof of withholding/collection is unified evidence made to correct mistakes in filling out the proof of withholding/collection; and

4.   Cancellation of unified proof of withholding/collection is unified evidence that is made to cancel the unified proof of withholding/collection.

Proof of settlement of underpaid stamp duty

In connection with the issuance of DGT Regulation No. PER.01/PJ/2021, the DGT has issued Circular Letter No. SE-01/PJ/2021 (SE-01/2021) in order to provide guidelines for the implementation instruction on affixing proof stamp for settlement of the payable stamp duty.

A request for affixing stamp for proof of settlement of underpaid stamp duty shall be made in the event that there is a difference in amount for the payment of stamp duty by using a tax payment slip (SSP).

The completed request form will be assigned by the Head of the Service Section to ensure:

  • The correctness of SSP that has obtained NTPN;

  • The conformity of the payment value in the SSP;

  • The conformity in the serial number of the check and/or clearing-account letter listed in the SSP; and

  • The conformity of the tax account code and deposit type code, namely tax account code is 411611 and deposit type code is 100.

This regulation became effective on January 8 2021.

 

I Dewa Made Agung Nugraha

Partner, GNV Indonesia

E: dewa.nugraha@gnv.id

  

 

 

Dwipa Abimanyu Dewantara

Manager, GNV Indonesia

E: dwipa.dewantara@gnv.id

 

more across site & shared bottom lb ros

More from across our site

The firm is hunting for a senior TP manager in its quest to build a full-service practice in Indonesia, A&M Tax’s Jakarta head Jaap Zwaan tells ITR
With a new government in place, the evolving tax landscape presents both opportunities and challenges for taxpayers
Major economies have expressed concerns, with China arguing a US global minimum tax exemption would be a violation of the principle of fair competition – ITR understands
Senator Richard Colbeck told ITR he was concerned by the decision to let PwC Australia tender for government contracts again after a scandal-induced ban
Whether it be due to a fragmented advisory market or a rise in M&A, Italy’s frenetic hiring has not gone unnoticed by ITR’s Talent Tracker
The deal gives Azets 14 new partners and boosts its Swedish revenues to over $100 million; in other news, Svalner Atlas launched in Copenhagen
The tax technology company will be providing a free demonstration of its OTP software and offering best practice advice on whether to ‘buy or build’ on September 8
Johanes Glorinus Saragih of Indonesia’s Directorate General of Taxes outlines the nation’s delicate geopolitical situation, as it sits between a rock and a hard place with the US and pillar two
The law firm’s head of tax, trade and wealth management likens tax legislation to a complex puzzle, recommends a sturdy coffee mug, and explains why acronyms make tax cool
The global tax and accounting firm has appointed two experienced TP advisers from a New Jersey-based boutique
Gift this article