Page 4 - Newsletter (Taxation Policies to Counter the Threat of Economic Recession and the Issuance of APA Implementing Regulation)

DDTC Newsletter Vol.03 | No.07 I April 2020 Page 4 of 9

Taxation Policies to Counter the Threat of Economic
Recession and the Issuance of APA Implementing Regulation

In the Face of Corona Outbreak, Exemption from Tax Penalties for
Sanctions on the Late Filing of Annual the Late Filing of Periodic 1111 VAT
Income Tax Returns are Exempted Return

The Directorate General of Taxes (DGT) has issued The DGT exempts administrative sanctions in the form of
a tax policy regulation concerning the spread of the fines for the late filing of the Periodic 1111 VAT Returns.
coronavirus (COVID-19). The policy is outlined in the This exemption is stipulated in the Director General
Director General of Taxes Decree No. KEP-156/PJ/2020 of Taxes Decree No. KEP-157/PJ/2020 concerning the
concerning Taxation Policies Concerning the Spread of Exemption from Administrative Sanctions in the Form
Coronavirus 2019 Outbreak (KEP DJP No. 156/2020). of Fines for the Late Filing of Periodic 1111 Value Added
This policy was enacted and entered into force on 20 Tax Returns Due on 31 January 2020 (KEP DJP No.
March 2020. 157/2020). This regulation was enacted and entered into
force on 20 March 2020.
The policy is intended to ease the burden and socio-
economic impact on taxpayers affected by Covid-19. The From 29 January 2020 to 3 February 2020, there were
regulation stipulates force majeure due to the spread of disruptions to the application which resulted in the
Coronavirus from 14 March 2020 to 30 April 2020. taxable persons for VAT purposes’ e-mail application not
being approved. This issue affected the fulfilment of the
The taxation policy takes the form of exemptions from tax
obligation to file Periodic 1111 VAT Returns.
administration sanctions. The administrative sanctions
apply for the delay of the following. First, the filing of The regulation stipulates a number of provisions. First,
annual individual income tax returns for tax year 2019. taxable persons for VAT purposes that filed Periodic
Second, the payment of tax underpayment in annual 1111 VAT Return for December 2019tax period through
individual income tax returns for tax year 2019. certain channels (e-filing) on 1 to 7 February 2020 are
exempted from administrative sanctions for the late
The abolishment of administrative sanctions is also
filing of the Periodic 1111 VAT Returns.
provided for taxpayers that file the periodic withholding
tax return for Tax Period February 2020 on 21 March Second, the administrative sanctions for the late issuance
2020 to 30 April 2020. The obligation to deposit income of tax invoices for taxable persons for VAT purposes
tax payable in the periodic withholding tax return must required to prepare tax invoices from 29 January to 3
still be carried out at maturity. February 2020 – because they supply taxable goods
(barang kena pajak/BKP) and/or taxable services (jasa
Taxpayers that prelodge legal measures are given a time
kena pajak/JKP) – but have only issued tax invoices
extension to submit the request until 31 May 2020. The
through the e-invoice application, in which the tax
measures referred to include objections, reduction,
invoices are dated 3 to 7 February 2020, are abolished.
or abolishment of the second administrative sanction,
and the reduction or cancellation of the Notice of Tax Such taxable persons for VAT purposes are those required
Assessment or the second Notice of Tax Collection (surat to submit Periodic 1111 VAT Returns for tax period
tagihan pajak/STP). December 2019 through certain channels (e-filing) with 2
provisions, namely 1) the validity period of the electronic
Administrative sanctions refer to administrative sanctions
certificates has expired until 31 January 2020 and 2)
of fines and interest. When they are imposed, the Notice
submitting the request for electronic certificates until 29
of Tax Collection shall not be issued as stipulated in Law
January 2020 until 7 February 2020, in accordance with
No. 16 of 2009 concerning General Provisions and Tax
the provisions on the procedures for the granting and
Procedures. In the event that the Notice of Tax Collection
revoking of electronic certificates.
has already been issued, the Head of the Regional Office of
the DGT may abolish administrative sanctions ex officio. The Notice of Tax Collection shall not be issued for
administrative sanctions in the form of fines. If the Notice
Further, the DGT provides a time extension for taxpayers
of Tax Collection has been issued on the administrative
to file reports regarding their participation in tax amnesty.
sanctions in the form of fines, the Head of the Regional
Said taxpayers may submit a report on the realization of
Office of the DGT will cancel administrative sanctions
the transfer and investment of additional assets and/or
based on the provisions of Article 36 paragraph 1 letter
report on the placement of additional assets no later than
(a) of the General Provisions and Tax Procedures Law.
30 April 2020.