Page 2 - Newsletter (VAT Refund for Tourist: Simplified Retail Shop Registration Mechanism)

DDTC Newsletter Vol.02 | No.07 I October 2019 Page 2 of 4

VAT Refund for Tourist: Simplified Retail Shop Registration
Mechanism

Simplified Registration Mechanism of revokes Director General Regulation No. PER-28/PJ/2013
Tourism VAT Refund for Retail Stores (DGT Reg No. 28/2013). Moreover, based on the new
provision, the DGT will subsequently issue a printable
decision letter regarding the appointment of the retail
The government has simplified the registration
store through the VAT Refund for Tourists application on
mechanism to become a taxable person for VAT purpose
the DGT’s webpage.
of retail stores (Pengusaha Kena Pajak Toko Retail/PKP
Retail Store) willing to participate in the VAT Refund
Thus, the appointed PKP Retail Store can determine the
scheme in the tourism sector. This simplification is
branch and/or retail store that will participate in the
stipulated in the Director General of Taxes Regulation No.
VAT refund for foreign tourists scheme, increase and/or
PER-17/PJ/2019 concerning the Registration Procedures
decrease the number of branches and/or retail stores,
and the Obligations of PKP Retail Stores Participating in
and confers independent access rights for retail stores
the Value Added Tax (VAT) Refund for Foreign Tourists
through the application.
Scheme (DGT Reg No. 17/2019).
Considering that the new registration procedure can be
One of the objectives of this regulation is, among others,
conducted online, an internet connection is compulsory
to enhance the role of PKP Retail Stores and improve
for retail stores. In addition, the sample of the Decision
services in the VAT refund scheme for tourists. PKP Retail
Letter concerning the Appointment of PKP Retail Store is
Store is defined as a taxable person for VAT purposes that
listed in Appendix A DGT Reg No. 17/PJ/2019.
supply taxable goods through retail stores.
The Obligations of Retail Stores
Under the new regulation, a PKP Retail Store who is willing DGT Reg No. 17/2019 also stipulates the obligations of
to participate is only required to register electronically PKP Retail Stores. First, printing and sticking/attaching a
through the VAT Refund for Tourists application on the ‘Tax Free Shop’ logo on every retail store incorporated in
webpage of Directorate General of Taxes (DGT). On the VAT refund scheme for foreign tourists.
another note, the VAT Refund for Tourists application
Second, providing information, either printed or through
supports the registration process, issuance of special tax
social media regarding VAT refund for foreign tourists,
invoices, and/or VAT refunds to foreign tourists. A user
including the information on the Implementing Unit of
manual is integrally embedded within the application.
VAT Refund of the Airport (Unit Pelaksana Restitusi Pajak
Pertambahan Nilai Bandar Udara/UPRPPN Bandara)
Moreover, after the registration of PKP Retail Store,
marked with the ‘Tax Refund For Tourists’ logo.
the DGT subsequently issues a printable decision
letter regarding the appointment as PKP Retail Store
UPRPPN Bandara is a special unit under the tax office
through the VAT Refund for Tourists application on the
whose working area includes the place before the check-
DGT’s webpage. This is significantly different from the
in counter in charge of processing requests of VAT refunds
registration procedures in the previous regulation.
for foreign tourists. The examples of ‘Tax Free Shop’ and
‘Tax Refund For Tourists’ logo can be found in Appendix B
Under the previous regulation, to register, a PKP Retail
and C DGT Reg No. 17/2019.
Store was required to apply for a decision letter and PIN.
Subsequently, the PKP Retail Store was required to wait Third, issuing a special tax invoice through the VAT Refund
for a maximum of 10 working days for either a decision
for Tourists application for the supply of luggage to a
or rejection letter. After the issuance of PIN and decision
foreign tourist holding a foreign passport and willing to
letter, the tax office had to send it by post or expedition to
obtain a VAT refund. The special tax invoice is prepared
the PKP Retail Store.
in triplicate for different designations:
The tax office was also required to input the proof of
• the first sheet, for foreign tourists to apply for VAT
delivery number in the application. Upon registration, the
refund;
DGT would issue a printable decision letter concerning
the appointment of the PKP Retail Store through the same • the second sheet, for UPRPPN Bandara through the
application. Further, a PKP Retail Store that received a foreign tourists; and
PIN was obliged to immediately perform activation as the • the third sheet, for the archive of PKP Retail Store
PIN would only be valid for 30 days. If such a time limit through the retail store.
was exceeded, the PIN would then be declared invalid.
Fourth, providing answers concerning the validity of
Signed on 25 September 2019, the new regulation has special tax invoice data against the actual situation, in
come into force as of 1 October 2019. Its enactment