Indonesia: Reduced tax rates offered to publicly listed companies

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: Reduced tax rates offered to publicly listed companies

Sponsored by

sponsored-firms-gnv.png
Indonesia has moved ahead with the national implementation of the e-Faktur desktop application

Benjamin Simatupang and Fabian Abi Cakra of GNV Consulting highlight the key tax-related developments from September and October 2020 in Indonesia.

Applying the corporate income tax rate for publicly listed taxpayers

On September 1 2020, the Minister of Finance (MoF) issued Regulation No. 123/PMK.03/2020 (PMK-123) which provides administrative guidelines to enjoy the corporate income tax (CIT) rate reduction for publicly listed taxpayers registered in the Indonesia Stock Exchange.



In brief, PMK-123 provides guidelines as follows:



1.   The publicly listed taxpayer should submit the following reports along with the CIT return:

  • Monthly reports which outline the name of the taxpayer, tax ID number, fiscal year and specific statement on the fulfillment of the administrative requirements which can be obtained from the Securities Administration Bureau, or those who perform self-reporting, and a

  • Report of shares ownership by affiliated parties of the taxpayers.


2.   A taxpayer may enjoy the CIT reduction in the fiscal year 2020 provided that it fulfills the following cumulative requirements:

  • For early periods of 2020 until Government Regulation No. 30 of 2018 (PP-30) came into force, at least 40% of the total shares are publicly traded in Indonesia, and the shares must be owned by a minimum of 300 parties and the ownership of each shareholder shall be less than 5% of the total issued shares;

  • After PP-30 came into force, the above shares shall not be repurchased by the issuer and/or its affiliated parties; and that

  • These requirements must be fulfilled for at least 183 calendar days of a fiscal year.


It should be noted that PMK-123 also defines the affiliated party of a publicly listed taxpayer based on the definition in the prevailing income tax law, but limited to the controlling shareholder and/or main shareholders under the definition of the Indonesian capital market law and regulations.

The expiring final income tax regime for corporate taxpayers

On September 7 2020, the Directorate General of Taxes (DGT) issued  Announcement No. 10/PJ.09/2020 (PENG-10) concerning the expiration of the final income tax regime as stipulated in Government Regulation No. 23 of 2018 (PP-23) for corporate taxpayers.



The main points of PENG-10 are summarised as follows:



1.   The regime of PP-23 shall expire at the latest within:

  • Three fiscal years for corporate taxpayers in the form of a limited liability company; and

  • Four fiscal years for corporate taxpayers in the form of a cooperative, limited partnership, or a firm.


2.   In the event that the taxpayer, as referred to in number one, was registered in the 2018 fiscal year, the final income tax regime of PP-23 is applicable until:

  • The end of the fiscal year 2020 for a corporate taxpayer in the form of a limited liability company; and

  • The end of the fiscal year 2021 for a corporate taxpayer in the form of a cooperative, limited partnership, or a firm.


When the period as referred to in number two ends, the taxpayer shall fulfill its tax obligations in accordance with the general income tax regime for the following tax years.

The implementation of e-Faktur 3.0

On September 11 2020, the DGT issued Announcement No. 11/PJ.09/2020 (PENG-11) regarding the national implementation of the e-Faktur desktop application version 3.0, which is effective from October 1 2020.



The salient points of PENG-11 are summarised as follows:

  • All VAT-able taxpayers are required to download the latest application at https://efaktur.pajak.go.id.

  • The user is recommended to keep a back-up of databases and copy the previous database to the new e-Faktur 3.0 platform;

  • This desktop application brings features including pre-populated input VAT for import declarations (PIB), e-VAT invoices (e-Faktur), VAT refunds, synchronised e-Faktur electronic stamps, and pre-populated monthly VAT returns.


Draft bill on stamp duty

On September 29 2020, the House of Representatives of Indonesia approved the draft bill on stamp duty as an amendment of Law of the Republic of Indonesia No. 13 of 1985 concerning stamp duty.



The key elements of the bill include:



The updated stamp duty rate would implement a single rate of IDR 10,000 ($0.69);

Stamp duty of a nominal value of IDR 10,000 must be affixed to :

  • Documents which are used as evidence in court; and

  • Documents which are used in order to elaborate upon civil-related events, including :

    • Agreements, statement letters or similar as well as their copies;

    • Notarial deeds, as well as their counterpart originals and copies;

    • Deeds that are drawn up by land-deed officials and their copies;

    • Securities under any name and in any form;

    • Securities transaction documents, including transaction documents for futures contracts;

    • Auction documents;

    • Documents stating sums of money in nominal values which exceed IDR 5 million and which address the receipt of money or which contain acknowledgment of full or partial payments or calculations of loans.


Temporary or indefinite exemptions from the imposition of stamp duty are to be granted in relation to certain types of documents, as follows :

  • Documents which address transfers of rights over lands and/or buildings in order to accelerate the restoration of socio-economic conditions;

  • Documents which address transfers of rights over lands and/or buildings used for non-commercial regional/social purposes;

  • Documents which promote or implement government programs;

  • Documents that relate to the implementation of international agreements.


This bill is due to come into effect from January 1 2021.






Benjamin Simatupang

T: +62 21 2988 0681

E: benjamin.simatupang@gnv.id



Fabian Abi Cakra

T: +62 21 2988 0681

E: fabian.cakra@gnv.id

more across site & shared bottom lb ros

More from across our site

Wim Wuyts, who had been head of the specialist tax network since 2017, is moving on to a new role with WTS’s Belgian member firm
MNEs are increasingly using algorithmic tools in TP. Sahasranshu Dash argues that data ethics should therefore plug directly into the TP design process
The Institute of Chartered Accountants in England and Wales also queried whether HMRC resources could be better spent scrutinising larger entities
Grant Thornton’s Austria tax head likens his practice to an escape room, shares his football coaching ambitions, and explains why tax is cool
Awards
ITR is delighted to reveal all the shortlisted nominees for the 2025 EMEA Tax Awards
Awards
ITR is delighted to reveal all the shortlisted nominees for the 2025 Asia-Pacific Tax Awards
The fates of pillars one and two hang in the balance after the US successfully threw its weight around in G7 and Canadian negotiations
Rafael Tena tells ITR about the ‘crazy’ Mexican market, ditching the hourly rate, and refusing to grow his fledgling firm in an ‘unstructured way’
It should be easy for advisers to be transparent about costs, Brown Rudnick partner Matthew Sharp said in response to exclusive ITR in-house data
The sprawling legislation phases out Joe Biden-era green tax incentives for businesses; in other news, the UK will reportedly maintain its DST despite US pressure
Gift this article