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Indonesia seeks growth and clarity through new export regulations

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Jeklira Tampubolon and Aditya Nugroho of GNV Consulting summarise the recent regulatory developments concerning Indonesian exports, with a particular eye on palm oil and its derivatives.

The Indonesian government attempted to encourage economic growth and to optimise and stabilise production and trade chains through the issuance of Ministry of Finance Regulation No 102/PMK.010/2022 on June 13 2022. The regulation stipulates the goods that are subject to export duty and the export duty rates under the framework of the programme for accelerated export distribution of crude palm oil; refined, bleached and deodorised palm oil; refined, bleached and deodorised palm olein; and used cooking oil.

Under the attachment to the regulation (PMK-102), the calculation of export duty in the context of the export distribution acceleration programme uses the following formula:

Export duty = Export duty rate per unit of goods in certain currency units x Number of units x Currency exchange rate.

The export duty rate was valid until July 31 2022. After the programme’s end exports can still be carried out if the export customs notification registration number was obtained no later than July 31 2022. Export goods that were subject to export duty based on PMK-102 are not subject to export duty based on Ministry of Finance (MoF) Regulation No 39/PMK.010/2022 (PMK-39) concerning the stipulation of exported goods subject to export duty and the export duty rate, and its amendments. PMK-102 has been effective since June 14 2022.

Improved customs services

The government issued MoF Regulation No 106/PMK.04/2022 (PMK-106) concerning the collection of export duties, dated June 20 2022, to improve customs services for the exportation of goods subject to export duty. Exported goods will be subject to export duties as stipulated in this regulation.

Export duty is imposed at a rate based on a percentage of the export price (ad valorem) or at a set amount. The exchange rate used for calculating and paying the export duty is the rate that is in effect at the time of payment. However, some items are excluded, as regulated in Article 2, paragraph 2 of PMK-106.

Exported goods that are subject to export duty shall undergo physical inspection, including the quantity and type of goods, selectively by customs and excise officials, based on risk management. The export duty must be paid no later than when the export declaration is registered with the customs office by the exporter. If the exporter is not identified and the processing of the export declaration is delegated to a customs broker (PPJK), the responsibility for the export duty will also shift to the PPJK. PMK-106 was issued on June 22 2022 and has been effective since July 21 2022.

Palm oil export duty

To support the stability and availability of prices of palm oil products, crude palm oil (CPO) and its derivative products, the MoF issued Regulation No 98/PMK.010/2022 (PMK-98) regarding an amendment to PMK-39 concerning the determination of exported goods that are subject to export duty and the rate of export duty.

There is a change in the determination of exported goods that are subject to export duty in the form of palm oil, CPO and its derivative products. There are 24 products subject to export duty, and the export duty amount for each product is determined based on 17 reference prices, as follows:

  • Up to $750;

  • $750–800;

  • $800–850;

  • $850–900;

  • $900–950;

  • $950–1,000;

  • $1,000–1,050;

  • $1,050–1,100;

  • $1,100–1,150;

  • $1,150–1,200;

  • $1,200–1,250;

  • $1,250–1,300;

  • $1,300–1,350;

  • $1,350–1,400;

  • $1,400–1,450;

  • $1,450–1,500; and

  • more than $1,500.

The higher the reference price of a product, the higher the export duty. The details of export duties for each product in the price ranges described above are given in PMK-98. PMK-98 was issued on June 9 2022 and has been effective since June 10 2022.

Net asset disclosure

Taxpayers are given the chance to disclose their unfulfilled tax obligations voluntarily by paying the final income tax that is due and submitting a notification of asset disclosure, under MoF Regulation No 196/PMK.03/2021 regarding the procedures for the implementation of the taxpayer voluntary disclosure programme.

If there is a net asset disclosed that is not in accordance with the actual, the net asset disclosure certificate can be amended or revoked. The Directorate General of Taxes has issued Circular No SE-17/PJ/2022 as the technical guidance for the amendment or revocation of certificates of disclosure of net assets.

The objective of this circular is to provide guidance and uniformity in the implementation related to the amendment or revocation of certificates of disclosure of net assets. The circular provides instructions related to technical matters in relation to:

  • An amendment or revocation of a certificate of disclosure of net assets in the event that there is an error in writing and/or a miscalculation in the certificate; and

  • A follow-up on data obtained by the tax office, a request for an amendment submitted by the taxpayer and other matters.

Circular No SE-17/PJ/2022 was issued on June 21 2022 to provide clearer technical guideline for amendment or revocation of Certificate of Disclosure of Net Assets.

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