Page 6 - Newsletter (Tax Return Procedures During COVID-19 Pandemic and Provisions on Article 25 Income Tax Installments at a New Rate)

DDTC Newsletter Vol.03 | No.09 I May 2020 Page 6 of 9

Tax Return Procedures During COVID-19 Pandemic and Provisions
on Article 25 Income Tax Installments at a New Rate

Organization and Simplification of Implementing Regulation for the
Import Licensing Provision of Goods and Services
Facilities to Address COVID-19
The government has issued a regulation to facilitate
import licensing. The regulation is outlined in
The Director General of Taxes has issued an implementing
Presidential Regulation No. 58 of 2020 concerning the
regulation on the provision of goods and services
Organization and Simplification of Import Licensing
facilities to address COVID-19. The policy is outlined
(Perpres 58/2020). Promulgated on 14 April 2020, this
in the Director General of Taxes Circular No. SE-24/
regulation has come into force thereafter.
PJ/2020 concerning the Implementation Guidelines for
The ease of import licensing aims to maintain the the Minister of Finance Regulation No. 28/PMK.03/2020
availability of affordable consumer goods and to uphold concerning the Provision of Tax Facilities on Goods and
the sustainability of industrial production processes that Services Required to Address Corona Virus Disease
require raw materials and/or auxiliary materials. 2019 (COVID-19) (SE-24/2020). This regulation was
promulgated on 21 April 2020.
The organization and simplification of import licensing
are intended to fulfill five types of needs. First, staple Most of the materials in this circular have been regulated
goods and foodstuffs. Second, government food reserves. in MoF Reg. No. 28/2020. This circular, in general,
Third, raw materials or auxiliary materials. Fourth, goods outlines the procedures for utilizing several tax facilities.
and raw materials for disaster prevention or handling. First, the procedures for utilizing VAT facilities. The VAT
incentives are given to certain parties for the imports
Fifth, other needs stipulated by the government.
or supplies of taxable goods (Barang Kena Pajak/BKP),
The organization and simplification of the licensing supplies of taxable services (Jasa Kena Pajak/JKP), and/
take into account the availability, production, and prices or the utilization of JKP from outside the customs area.
of goods as well as national interests. Types of import
Furthermore, BKP on which VAT is not wittheld or borne
licensing include approval, registration, determination,
by the government includes drugs, vaccines, laboratory
and recognition.
equipment, detection, personal protection, patient care,
There are several types of requirements for import and other supporting equipment declared as tools to
licensing. The types of requirements include: handle COVID-19.
permits, approvals or letters of consent, certificates,
JKP eligible for these facilities include construction
recommendations, technical considerations,
services, consulting services, engineering and
determination of the adequacy of consumption needs,
management, rental services, and other supporting
production of staple food, government food reserves, services required to handle COVID-19. Taxable persons
and/or other types of import licensing requirements. for VAT purposes (Pengusaha Kena Pajak/PKP) supplying
BKP and/or JKP are required to prepare tax invoices as
The requirements are stipulated by the minister or head
per applicable regulations.
in charge of sectors related to imported products or goods
in writing. These requirements may be stipulated based Second, the procedures for utilizing exemptions from
on the decision of the coordination meeting contained in Article 21 income tax withholding. Resident individual
the minutes of the meeting. taxpayers that receive or obtain compensation from
certain parties, on which Article 4 paragraph (2) income
Under certain circumstances, technical requirements
tax has been withheld, are exempted from Article 21
may be deferred or exempted insofar as the Occupational
Health and Safety (Kesehatan, Keamanan, Keselamatan, income tax withholding.
dan Lingkungan/K3L) aspect is taken into account. Exemptions from Article 21 income tax withholding are
Certain circumstances include three aspects. First, urgent given without any Article 21 income tax withholding
needs or prices exceeding the reasonable level. Second, exemption certificates (Surat Keterangan Bebas/SKB). To
the lack of or limited domestic or international supply. supervise the utilization of these facilities, certain parties
Third, barriers to trade traffic and/or disruptions to are obliged to prepare reports on Article 21 income tax
distribution. exemptions for all payment transactions of individual
resident taxpayers.
Imported staple products or goods are entitled to
taxation, customs, and/or excise facilities. The types and Third, the procedures for utilizing exemptions from
quantities of products or goods eligible for these facilities Article 22 income tax withholding. Certain parties that
are decided through a coordination meeting. import goods are exempted from Article 22 income
tax withholding. Exemptions are given without import
article 22 income tax SKB. Certain parties must submit