Page 2 - Newsletter (VAT Borne by the Government Incentive for Mass Media and the National Implementation of E-Faktur 3.0)

DDTC Newsletter Vol.04 | No.05 I September 2020 Page 2 of 6

VAT Borne by the Government Incentive for Mass Media and
the National Implementation of E-Faktur 3.0

VAT Incentives on Imports and/or The tax invoices must be given a note “VAT BORNE
Supplies of Newspaper and Magazine BY THE GOVERNMENT AS PER MoF Reg. No. 125/
Paper PMK.010/2020". The tax invoices must be reported in
the Periodic VAT Returns as per applicable provisions
by the PKP that supply newspaper and/or magazine
The government grants a value added tax (VAT) borne
paper. Tax invoices reported in the Periodic VAT
by the government (Ditanggung Pemerintah/DTP)
Returns also serve as the report on VAT DTP realization.
facility on imports and/or supplies of newspaper and/
or magazine paper. This facility is provided as a form Further, this regulation asserts that the supplies of
of support as well as an effort to address the impact of newspapers and/or magazine paper that do not use
the Corona Virus Disease 2019 (Covid-19) pandemic tax invoices with the VAT DTP information shall not be
on the productivity of the printed mass media. provided with the VAT DTP incentives and are subject
to VAT according to applicable provisions. Likewise,
The granting of the VAT DTP facility is outlined
the supplies of newspaper and/or magazine paper
in the Minister of Finance Regulation No. 125/
whose tax invoices are not reported in the Periodic
PMK.010/2020 concerning Value Added Tax on
VAT Returns, will not be given VAT DTP incentives and
Imports and/or Supplies of Newspaper and/or
will be subject to VAT as per applicable provisions.
Magazine Paper Borne by the Government for Fiscal
Year 2020 (MoF Reg. 125/2020). The implementation and accountability of this VAT
DTP subsidy are carried out as per the provisions under
The facility for the 2020 fiscal year is provided for
the Minister of Finance Regulations that stipulate the
the imports of newspaper and/or magazine paper by
implementation and accountability mechanisms for
press companies, either performed on their own or
DTP taxes.
as an indentor. On another note, it is also granted for
the supplies of newspaper and/or magazine paper to Taking effect in 7 days as of 8 September 2020, this
press companies. regulation also allows the Head of the Tax Office
(Kantor Pelayanan Pajak/KPP) on behalf of the
A press company refers to an Indonesian legal
Director General of Taxes to collect VAT payable in
entity that operates a press business in the form of
the event that data/information which shows the
a print media company that specifically organizes,
following three things is obtained:
broadcasts, or distributes information in the form
of publishing newspapers, journals, bulletins, and i. the taxpayer is not entitled to government
magazines. Publishers of said newspapers, journals, borne VAT facilities;
newsletters, and magazines must be included in
ii. the object supplied or imported does not
business classification (Klasifikasi Lapangan Usaha/
constitute newspaper and/or magazine paper
KLU) 58130.
entitled to the facility based on this Ministerial
Regulation; and/or
This KLU is the KLU listed in the 2019 Annual Income
Tax Return that has been filed by the taxpayer, the iii. the newspaper and/or magazine paper
2018 Annual Income Tax Return, for taxpayers whose provided with this facility under this Ministerial
reporting obligations for the 2019 Income Tax Return Regulation is not used for the manufacture of
is not yet due or the data contained in the taxpayer’s newspapers and/or magazines.
master file), for new taxpayers registered after 2019.

This regulation outlines that the newspaper granted
Regulation on the Reporting of
with the VAT DTP facility is the paper listed under
HS Code 4801 of the 2017 Indonesian Import Duty Income Tax Rate Reduction Incentives
Tariff Book (Buku Tarif Kepabeanan Indonesia/BTKI).
Conversely, the magazine paper entitled to this facility for Publicly Listed Companies
is the paper listed under HS Code 4802, HS Code 4805,
HS Code 4810, and HS Code 4811 in the 2017 BTKI. The Ministry of Finance stipulates the format and
procedures for submitting reports on the fulfillment
This regulation, however, requires Taxable Persons of the requirements for the utilization of corporate
for VAT Purposes (Pengusaha Kena Pajak/PKP) that income tax reduction for publicly listed companies.
supply newspapers and/or magazine paper to prepare This policy is outlined in the Minister of Finance
tax invoices as per applicable provisions and the report Regulation No. 123/PMK.03/2020 concerning the
on VAT DTP realization.