Indonesia: Taxation committee suggests incentives for online marketplace

• Feb 21, 2019

The Taxation Supervisory Committee (KPP) has suggested that digital marketplace service providers need incentives to balance out the additional burden of a new regulation on tax treatment for e-commerce transactions.

The KPP is an independent committee that is tasked with monitoring taxation policy and implementation. The committee, which reports directly to the Finance Minister, called for improvements to tax policy.

KPP division head of analysis and consultation Herry Setyawan said the committee had been exploring a number of ideas to provide incentives to online marketplaces.

“If the marketplaces have tax obligations, they should be given enough time to manage their cash flow,” said Herry in a recent interview in Jakarta.

He went on to add that the committee was also actively communicating with the Indonesian E-Commerce Association to accommodate the latter’s concerns and ideas, particularly on how to also apply equal tax treatment to online sellers who sold their goods and services via social media.

“The committee had prepared suggestions [for the tax authorities] on how to accommodate suggestions from business players,” said Herry.

The government had issued Finance Ministerial Regulation No. 210/2018, which is to come into effect April 1, with the aim of subjecting businesses in the digital economy to tax treatment equal to that of conventional businesses. (bbn)

Source: https://www.thejakartapost.com/news/2019/02/21/taxation-committee-suggests-incentives-for-online-marketplace.html