Page 9 - Newsletter (Recent Regulations on Tax Holiday Incentives and Super Tax Deduction for R&D Activities)

DDTC Newsletter Vol.04 | No.08 I October 2020 Page 9 of 13

Recent Regulations on Tax Holiday Incentives and
Super Tax Deduction for R&D Activities

Procedures for the Selection of
Facilities on Imported Goods for Handling the Covid-19
Pandemic (MoF Reg. 149/2020). This regulation has Service Providers and Addition of Tax
taken effect as of 8 October 2020.
application Services
Under this regulation, the types of goods entitled
to customs and/or excise and taxation facilities The Director General of Taxes has issued guidelines
are reduced. This is aimed at encouraging national for the selection of tax application service providers
economic growth in the industrial sector for certain (Penyedia Jasa Aplikasi Perpajakan/PJAP) and
types of personal protective equipment (PPE), additional tax application services. The implementing
medicine, and certain types of medical devices that guidelines are listed in the Director General of
can be produced domestically and are sufficient to Taxes Circular No. SE-48/PJ/2020 concerning the
meet domestic needs. Moreover, the regulation aims Guidelines for the Implementation of the Selection of
to provide legal certainty and accelerate services for Tax application Service Providers and Addition of Tax
the granting of customs and/or excise and taxation application Services (SE-48/2020).
facilities on imported goods for handling the Covid-19
pandemic. PJAP or application service provider (ASP) is the party
appointed by the director general of taxes to provide
With this ministerial regulation, the government tax application services for taxpayers and may provide
amends the details of the types of goods that may supporting application services for taxpayers. The
receive customs and/or excise facilities as well as tax circular states that the Directorate General of Taxes'
facilities listed in the Appendix of this regulation. (DGT) electronic services continue to be developed
to render effectiveness and efficiency in services
The changes stipulate that the current incentives only
for taxpayers. The DGT’s electronic services are
apply to PCR tests; media transfer virus; finished drugs;
developed, among others, through the provision of
medical equipment, such as thermometers, ventilators,
several applications.
swabs, thermal imaging/scanning equipment, in vitro
diagnostic equipment including PCR tests, syringes In effect as of 18 September 2020, this circular is an
and infusion pumps, power air purifying respirators, implementing regulation of the Director General of
and baby incubator transport; and PPE in the form of Taxes Regulation PER-10/PJ/2020. The scope of this
a mask. circular covers three things. First, the terminology
used.
The abovementioned finished drugs include
tocilizumab, intravenous immunoglobulin (IVIG), Second, procedures for the pre-selection and selection.
mesenchymal stem cells (MSCs), low molecular In the pre-selection process, the Director General of
weight heparin (LMWH)/unfractionated heparin Taxes establishes a PJAP selection team through the
(UFH), favipiravir, insulin, and lopinavir+ritonavir. As Director General of Taxes decree concerning the PJAP
such, rapid tests, various types of vitamins, syringes, selection team at least once in two years. In the event
high flow oxygen, portable bronchoscopy, CPAP-mask, of a change in the composition of members due to
pediatric CPAP machines, ECMOs, baby incubators, employee mutations or other policy-related changes,
protective clothing, and gloves are no longer the Director General of Taxes shall issue a Director
incentivized. General of Taxes decree concerning changes to the
Director General of Taxes decree concerning the PJAP
As this regulation comes into force, all applications
selection team. The procedures for determining the
that have received a number or have received a
PJAP selection team are listed in Appendix A of SE-
registration date before the enactment of this
48/2020.
regulation may apply the former regulation, i.e. MoF
Reg. No. 34/PMK.04/2020 as amended by MoF Reg. Third, the procedures for adding tax application
No. 83/PMK.04/2020. services. In terms of the addition to tax application
services, the ICT Director is authorized to process the
application. In general, the procedures for processing
applications for additional tax application services
are carried out based on the selection procedures
regulated under SE-48/2020.
In the business planning assessment procedures, the
status of passing the business planning assessment