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Indonesia: Classification of tax objects and determining sales value for land and building tax

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Jeklira Tampubolon and Aditya Nugroho of GNV Consulting Services overview Indonesia’s latest regulatory changes and their implications for businesses.

The Minister of Finance (MoF) has issued PMK-234 to amend MoF regulation PMK-186, concerning the “classification of tax objects and the procedure in determining the sales value of taxable objects for land and building tax (LABT)”. PMK-234 became effective on 1 January 2023. 

The main changes between PMK-186 and PMK-234 include: the definition of a tax appraiser, additional information on taxable objects, exclusion of tax objects and the issuance of tax assessment letters. Under the amended regulation, the Directorate General of Taxes (DGT) may conduct a field assessment based on the LABT Return.

Extension for electronic certificates, EFINs and verification codes

On January 3 2023, the DGT issued PENG 1/2023, concerning the extension for electronic certificates, electronic filing extension numbers (EFINs), and verification codes. The announcement is related to the renewal of the core tax administration system and redesign of the tax administration business processes as stipulated in MoF regulation PMK-63. 

PMK-63/2021 outlines the provisions regarding electronic certificates issued by the DGT in accordance with PMK-147/2017, which were valid until December 31 2022. However, the DGT has not issued technical provisions related to signing electronic documents and using electronic certificates in accordance with PMK-63/2021. 

The PENG 1/2023 announced that electronic certificates, EFINs, and verification codes shall remain valid until the electronic certificates and authorisation codes of the DGT are available in the DGT information system. 

As for the electronic issuance, signing and delivery of decisions or decrees processed automatically through the DGT website using non-certified electronic signatures, these can still be done until a certified option is available in the DGT information system. 

Regional Comprehensive Economic Partnership Agreements

To implement regional Comprehensive Economic Partnership Agreements (CEPAs) or free trade agreements (FTA), the MoF has issued several regulations determining import duty tariffs effective from January 2 2023. The list of MoF regulations is as follows:

Partner Country

MoF Regulation Number

ASEAN Countries*










New Zealand



  • ASEAN countries in this regulation refers to 10 countries: Brunei Darussalam, Cambodia, Indonesia, Malaysia, Myanmar, Philippines, Singapore, Thailand, Vietnam and Laos;

  • A CEPA for India has yet to be implemented; and

  • If the most favoured nation (MFN) import duty tariff rate is lower than the preferential import duty as stipulated in the regional CEPA, the applicable import duty tariff is the MFN.

These regulations generally stipulate as follows:

  • The preferential import duty tariff for imported goods from ASEAN countries follows the regional CEPA; and

  • The differential import duty tariff is applied to imported goods from ASEAN countries, if:

  • The imported goods classification is included in the appendix of the relevant MoF regulation; or

  • It is based on the examination result, the goods’ classification is included in the appendix of the relevant MoF regulation.

Republic of Korea

To implement the CEPA between Indonesia and the Republic of Korea, the MoF issued regulation PMK-227 concerning the determination of import duty between the two countries. PMK-227 is effective from 1 January 2023. 

This regulation stipulates that the preferential import duty tariff for imported goods from the Republic of Korea follows the CEPA with Indonesia.

If the MFN import duty tariff rate is lower than the preferential import duty as stipulated in the agreement, the applicable import duty tariff is the MFN.

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