Page 10 - Newsletter (Reduction of Income Tax Rates for Publicly Listed Companies and Establishment of VAT Withholder Criteria for E-Commerce Businesses)

DDTC Newsletter Vol.04 | No.01 I July 2020 Page 10 of 13

Reduction of Income Tax Rates for Publicly Listed Companies and
Establishment of VAT Withholder Criteria for E-Commerce Businesses

such, the deadline which was originally 29 June 2020 government agencies in the July 2020 tax period and
is extended to 6 July 2020. Likewise, the deadline subsequent tax periods have used government agency
that falls on 5 July 2020 becomes 12 July 2020. The tax identification numbers.
deadline for the submission of appeals and lawsuits by
post still refers to the provisions under Law No. 14 of
The Stipulation of Import Duties in
2002 concerning the Tax Court.
the Framework of ASEAN-Hong Kong
Further, the period of preparation and implementation
Free Trade Agreement (AHKFTA)
of trial proceedings does not take into account the
period from 29 June 2020 to 5 July 2020 (7 days) in
the calculation of the period under the provisions in The government has set import duties tariffs in
Article 48, Article 81, and Article 82 of Law No. 14 the framework of the Asean-Hong Kong Free Trade
of 2002. The period of other administrative services, Agreement (AHKFTA). The stipulation of the import
also under the provisions in SE-014/2020, does not duty tariffs is outlined in the Minister of Finance
take into account the period of 29 June 2020 until 5 Regulation No. 79/PMK.010/2020 concerning the
July 2020 (7 days) in the calculation of the period as Stipulation of Import Duty Tariffs in the Framework of
stipulated in Law No. 14 of 2002. This provision also the Asean-Hong Kong, the People’s Republic of China
applies to administrative service of power of attorney Free Trade Agreement (MoF Reg. 79/2020).
licenses.
Promulgated on 3 July and entered into force on
4 July, the regulation outlines the import duties
Adjustments to the Implementation rates in the framework of AHKFTA for 2020 to 2031
onwards. Upon further observation, a large number of
of Unified Periodic Tax Returns for import duty tariffs in the framework of AHKFTA have
Government Agencies decreased.

Examples of decreased import duty tariffs include
The implementation of reporting obligation for tax
that of koi fish and betta fish in 2020 to 2027 of 5%.
withholding and/or collecting and depositing using
This tariff decreases to 0% in 2028 onwards. Next, the
unified periodic tax returns for government agencies
import duty tariff for boneless mutton in 2020 will be
comes into force in January 2021 tax period and the
5% and 0% in 2021 onwards. This regulation, however,
tax periods thereafter.
emphasizes that if the statutory import duty tariff is
The adjustments to the implementation period are lower than the import duty tariff in the framework of
outlined in the Announcement No. PENG-75/PJ/2020 AHKFTA, the statutory import duty tariff shall apply.
concerning the Adjustments to the Implementation
The provisions under this regulation apply to imported
of Unified Periodic Tax Returns for Government
goods of which the customs declaration documents
Agencies (PENG-75/2020). Under the announcement,
have obtained the number and date of registration
the Director General of Taxes states that the Covid-19
from the customs office where customs obligations are
pandemic has hindered the implementation of
fulfilled as per the provisions in the Customs Law.
government agencies’ unified periodic tax returns
obligation. Import duties are imposed as per the Minister of
Finance Regulation No. 80/PMK.04/2020 concerning
For this reason, the DGT requires sufficient time
the Procedures for the Imposition of Import Duty
to prepare information technology support and
Tariffs on Imported Goods Based on the Asean-
disseminate information effectively and thoroughly
Hong Kong, People’s Republic of China Free Trade
to government agencies throughout Indonesia.
Agreement (MoF Reg. 80/2020).
Therefore, the implementation of reporting obligations
for tax withholding and/or collection and deposits by Under MoF Reg. 80/2020, the government confirms
Government Agencies using Government Agencies that imported goods must meet the Rules of Origin
Unified Periodic Tax Returns shall apply as of January to obtain import duties in the framework of AHKFTA
2021 Tax Period and the Tax Periods thereafter. or preferential tariffs. The provisions consist of
origin criteria, consignment criteria, and procedural
The implementation of reporting obligations for
provisions.
tax withholding and/or collection and deposits for
tax periods prior to January 2021 continues to use
the old periodic tax return forms. Nevertheless, the
exercise of rights and fulfillment of tax obligations for