Indonesia updates tax representation and digital VAT collection rules

Topic

New provision

Eligible tax representatives (Article 2)

Tax representatives are now categorised into three groups: tax consultants, other parties, and family members (i.e., spouse or relatives by blood or marriage up to the second degree).

Competency requirements (articles 3 and 5)

Tax consultants must hold a Tax Consultant Licence, while other parties must possess a Certificate of Registration (SKT). Competency requirements do not apply to family members acting as tax representatives. Additional requirements apply to retired or former employees/government employees with employment agreements (PPPK) of the MoF.

Special power of attorney (Article 7)

A special power of attorney (SPA) may now be executed electronically through the taxpayer portal (Coretax) or in paper form submitted through the Tax Office or Tax Service, Dissemination, and Consultation Office.

Limitations on representation (articles 8 and 13)

An SPA is valid for one representative and one specific tax right or obligation only. The authority granted may not be delegated to another person. However, the representative may authorise its employees solely to submit and/or receive certain tax documents.

Prohibited acts (Article 9)

The regulation specifies seven acts deemed to obstruct the implementation of tax laws, including providing misleading information, refusing to provide explanations, and failing to return borrowed documents.

Termination of representation (articles 10–12)

A tax representation terminates upon the expiry of the authorisation period, revocation by the taxpayer, suspension or revocation of the representative’s licence/SKT, or the issuance of a criminal court decision against the representative. Upon termination, the representative’s access to the taxpayer portal will also be revoked.

Transitional provisions (articles 15 and 16)

SPAs submitted prior to the enactment of MoF Reg. 44/2026 remain valid. In addition, parties other than tax consultants who hold certain tax brevet certificates or academic qualifications in taxation may continue to act as tax representatives using paper-based SPAs until December 31 2026.

Party

Role

Recipient of intangible taxable goods

An individual or entity that receives and pays for the utilisation of intangible taxable goods from outside the Indonesian customs territory through electronic systems.

Recipient of taxable services

An individual or entity that receives and pays for the utilisation of taxable services from outside the Indonesian customs territory within the territory through electronic systems.

Foreign digital transaction business operator

A foreign merchant, foreign service provider, and/or foreign electronic system operator conducting business through overseas electronic systems.

SPP-TDLN operator (PT Jalin Pembayaran Nusantara)

A legal entity designated under Presidential Regulation No. 68 of 2025; confirms whether VAT applies, receives, and remits VAT to the state treasury, and receives a service fee.

Other party (issuer)

Bank or non-bank institution facilitating payment, appointed by the director general of taxes (on delegation from the MoF) after completing a development and stabilisation period; collects VAT, submits transaction data, issues the collection document, and remits to the operator.

Time VAT becomes payable (Article 6)

VAT becomes payable when the SPP-TDLN operator confirms to the other party that the relevant transaction is subject to VAT.

VAT calculation (Article 7)

VAT is calculated using the formula of 11/111 × the VAT-inclusive transaction value. For transactions denominated in foreign currency, the transaction value must be converted into rupiah using the MoF’s prevailing exchange rate on the date the confirmation is issued.

Submission of transaction data (Article 8)

The other party is required to submit the transaction data to the SPP-TDLN operator no later than the payment authorisation stage. For data relating to the beneficiary account used for fund transfers (remittance), the information must be submitted in hashed form to ensure data confidentiality.

VAT collection document (Article 10)

The other party must issue a VAT collection document (e.g., a bill statement or similar document), which is treated as equivalent to a VAT invoice. The VAT stated in the document may be credited as input VAT by the recipient, provided that the recipient’s registered email address and/or telephone number has been registered with the Directorate General of Taxes and the general input VAT crediting requirements are satisfied.

VAT remittance (Article 14)

Other party → SPP-TDLN operator: within seven days from the date of confirmation. SPP-TDLN operator → state treasury: within seven days after receiving the VAT remittance from the other party.

VAT reporting (Article 15)

The SPP-TDLN operator is required to report all VAT collected on an aggregated basis in a separate monthly VAT return.

Transaction cancellation and VAT return amendment (Article 16)

For cancelled transactions or transactions where VAT should not have been collected, the person from whom VAT has been collected may submit a refund request through the other party to the SPP-TDLN operator. An amendment to the monthly VAT return is not permitted if the VAT return has been subject to a tax audit or if an overpayment VAT return is filed beyond the statutory time limit.