Indonesian Finance Minister Sri Mulyani Indrawati (Photo: Antara) Jakarta (VNA) – Indonesia collected 3.5 trillion rupiah (245.5 million USD) from digital tax between January 1 and early September, Finance Minister Sri Mulyani Indrawati has said.
Speaking at a meeting with the House of Representatives' Commission XI which oversees the commerce, industry, investment, cooperatives, small and medium-sized enterprises, and State-owned enterprises on September 13, she said the revenue raised from 83 companies that traded through the electronic system.
This was an amount that Indonesia “couldn't collect” before, she said.
Sri Mulyani clarified that this tax is obtained by levying value-added tax (VAT) on foreign digital products which these companies are developing.
According to the minister, these companies are operating on an international scale and have business operations in Indonesia, including Netflix, Zoom, Shopee, Alibaba Cloud Pte Ltd (Singapore), and GitHub. Inc, Microsoft Corporation, Microsoft Regional Sales Pte. Ltd and UCWeb Singapore Pte. Ltd.
In April last year, the Indonesian Government issued a digital tax regulation for global technology companies that are not registered in Indonesia but have revenue from consumers in the country within the framework of Law No 1/2020 on financial policies to respond to the COVID-19 pandemic.
Under the new rule, non-resident companies with revenue of at least 600 million rupiah from digital products and services in Indonesia, or at least 12,000 visits per year, will have to pay 10 percent VAT. Law No. 1/2020 states that the Government of Indonesia may levy VAT on intangible goods and/or services through e-commerce transactions. The government may also impose income tax on electronic system transactions by foreign individuals or digital companies with a “significant economic presence” in Indonesia./.
