EY Indonesia
Tax Insight
01/2013
Notification about VAT Invoice
Signer (Socialization for DGT Regulation
No. PER-24/PJ/2012 about VAT Invoice)
As you may be aware, the Directorate General of Taxes (“DGT”) has issued a new regulation
regarding VAT invoices, i.e. DGT Regulation Number PER-24/PJ/2012 dated 22 November
2012 and its implementing regulation DGT Circular number SE-52/PJ/2012 which will come
into effect on 1 April 2013.
This regulation provides new guidance on the preparation of VAT invoices. The significant
changes are in the numbering procedures of the VAT invoices and the format of the serial
numbers. With the enactment of this regulation, the serial numbers of VAT invoices will be
issued by the Tax Office.
The new format of VAT invoice serial numbers to be given by the Tax Office is as follows:
a. The first two digits are the Transaction Code
b. The next digit is the Status Code
c. The remaining digits represent the VAT invoice serial number consisting of an eleven digit
serial number and two digits for the issuance year)
Please note that based on the DGT socialization, the VAT invoice serial numbers can only be
given to the taxpayer if:
1. The re-registration of the VAT-able firm has been conducted by the Tax Office;
2. The address has been updated in accordance with the real condition (if the address is
changed);
3. The taxpayer has re-submitted the notification/acknowledgement letter with the specimen
signature along with the legalized copy of the identity card or passport, before
submitting the request for activation code and password;
4. The taxpayer has submitted the request for activation code and password, which can be
submitted starting 1 March 2013;
5. The taxpayer has received the password notification via email;
6. The taxpayer has submitted the request for VAT invoice serial number;
7. The taxpayer has input the correct activation code and password when submitting the
request for VAT invoice serial number;
8. The taxpayer has filed VAT returns for the last 3 (three) months prior to the request letter
being submitted to the Tax Office;
Following this, it is advisable for you to submit the notification letter of the signer of the VAT
invoices with the specimen of the signature along with the legalized copy of the identity card
or passport at the latest by 31 March 2013. Without this notification and the legalized copy of
the identity card or passport, the VAT invoice is considered an Incomplete VAT Invoice (and will
be subject to an administration sanction of 2% of the VAT base. In addition, such VAT invoice
cannot be credited as Input VAT by the Buyers.
Collection of tax information
(MOF Regulation Number 16
PMK.03/2013 dated 04 January 2013)
MOF has issued the implementing regulation for Government Regulation No. 31 Year 2012,
which provides the framework for collection of data and information related to taxation. In
addition to the detailed instruction of mechanism in collecting the data, the regulation provides
a list of the first batch of thirteen (13) government organizations, private organizations,
associations, and other parties required to provide the data and information to the DGT, which
includes: (1) Direktorat Jenderal Anggaran (Directorate General of Budget); (2) Direktorat
Jenderal Perbendaharaan (Directorate General of Treasury); (3) Direktorat Jenderal Bea
dan Cukai (Directorate General of Customs and Levy); (4) Direktorat Jenderal Perimbangan
Keuangan (Directorate General of Revenue Distribution); (5) Badan Kebijakan Fiskal (Fiscal
Policy Agency); (6) PT Pelabuhan Indonesia 1 (Persero); (7) PT Pelabuhan Indonesia II
(Persero); (8) PT Pelabuhan Indonesia III (Persero); (9) PT Pelabuhan Indonesia IV (Persero);
(10) BKPM (Investment Coordinating Board); (11) Kementerian Dalam Negeri (Ministry of
Internal Affair); (12) Otoritas Pelabuhan Kementerian Perhubungan (port authorities of the
Ministry of Transportation); and (13) Bank Indonesia (the Indonesian central bank).
The regulation contains the format and detail type of data and information and schedule
to be provided to the DGT in its attachment. The appointed officer should give the data
and information in electronic media to the appointed tax officer starting 1 May 2013. The
regulation defines the data and information as collection of number, letter, word, and/or image,
which can be in the form of a letter, document, book, or note and written description, which
provides indication of income and/or assets of an individual or an entity, including business
activity or independent personal services from an individual or an entity. The regulation is
effective from the date of issuance, i.e. 4 January 2013.
Amendment of several tax notices
under Article 16 of KUP Law
(MOF Regulation Number 11/
PMK.03/2013 dated 02 January 2013)
The regulation provides the procedures to amend several tax notices as governed under Article
16 of the Law on General Tax Rules and Administration (“UU KUP” or KUP Law) for mistakes
in writing, calculation and application of certain provisions of the Tax Laws. This regulation is
issued to synchronize the existing procedures with provisions in Government Regulation No. 74
Year 2011. Highlights of the new procedures are:
• The regulation provides detailed classification of errors that can be corrected.
• It is now possible to electronically submit the application through the DGT website (www.
pajak.go.id) or an Application Service Provider (ASP). Taxpayer will receive an Electronic
Receipt upon the submission. This procedure of submission is called “e-Filing”.
• The application letter is in a standard format as provided in the regulation.
• There is a 6 (six) months time limit for the DGT to issue a Decision Letter on the Correction. If
passed, the application is deemed approved by the DGT.
• Taxpayer can simultaneously apply for a correction and an objection on a tax assessment
letter. Decision on the request for correction is to be issued separately from the tax objection
decision.
• The DGT can issue amendment on an ex-officio basis based on the result of a Mutual
Agreement Procedure (MAP).
• Taxpayer can apply for objection on amendment that is issued on an ex-officio basis within
three (3) months from delivery date of amendment letter.
• For Fiscal Year 2007 and prior years, the DGT is allowed to issue amendment on the Objection
Decision Letter ex-officio if the decision is obviously not correct. In this case, taxpayer is
not allowed to submit an appeal on the Objection Decision Letter; otherwise the appeal
application should be decided as not acceptable.
This regulation revokes MOF Regulation No. 19/PMK.03/2008 and will enter into force on 1
March 2013. Since the new procedures are more detailed than the previous one, it is critical
that readers understand the new procedures.
Procedures for refund of tax that
should not have been paid (MOF
Regulation Number 10/PMK.03/2013
dated 02 January 2013)
MOF has issued a regulation regarding the new refund procedure of tax that should not have
been paid. The regulation is to synchronize the procedure in accordance with the Government
Regulation No. 74 Year 2011. For example, the refund application will now be processed
through the Verification procedure. We note that there are some improvements compared to
the previous regulation, such as: an entity or an individual who is not required to have a Tax
Identification Number (“NPWP”) can apply for refund from withholding taxes and obtain the
Tax Overpayment Assessment Letter. Also, it is clear now that foreign taxpayer who has a
Permanent Establishment in Indonesia should apply for the refund of withholding taxes through
EY Indonesia Tax Insight | 01/2013
its Permanent Establishment. The regulation provides more specific requirements to obtain the
refund of the taxes. Unfortunately, the regulation does not regulate the time limit to respond
to the application as of the previous regulation. Readers seeking for a refund of tax that should
not have been paid are recommended to identify their specific circumstance and adopt the
appropriate refund procedure as governed by this regulation to ensure the ability to claim back
the tax. The regulation entered into force on 1 February 2013 and revoked the previous MOF
Regulation.
Procedures to apply for tax
objection (MOF Regulation Number 9/
PMK.03/2013 dated 02 January 2013)
MOF has issued a new regulation providing procedures for application of tax objection. The
regulation is intended to provide procedures that are in line with Government Regulation No.
74 Year 2011. Highlights of changes in the procedures are:
• The regulation introduces an on-line submission for objection application called “e-Filing”.
• ►Taxpayer can only object on the content of the Tax Assessment Letter, which includes the loss
amount, the tax amount, or on the content from tax withholding. Any objection reason other
than those mentioned will not be considered.
• ►Taxpayer must use the format of objection application letter as provided in the regulation.
• ►Any amendment to a tax assessment letter issued before a taxpayer submit an objection
against the original tax assessment will cause an extension on the time limit to submit the
objection letter and this will be considered as one of the “force majeure”.
• ►If the objection letter does not fulfill the formal requirement, the objection will not be
considered and the DGT will not issue the Decision Letter on Objection. The notification letter
that the objection application letter does not fulfill the formal requirement is not a decision
and cannot be appealed to the tax court.
• ►Taxpayer can withdraw an objection request using the format as provided in the regulation.
The DGT is obligated to give its approval or refusal to the withdrawal in writing with the
format as described in the regulation.
• ►If the taxpayer withdraws the objection application, it cannot apply for reduction or
cancellation of the tax assessment letter.
• ►The DGT can request explanation or proof related to the tax dispute content to a third party.
• ►Taxpayer should provide the original tax withholding proofs in the objection process.
• ►If a taxpayer apply for objection and Mutual Agreement Procedure (MAP) at the same time
and the Mutual Agreement has not been obtained when the objection is due, the DGT will
issue the Objection Decision Letter based on the tax findings in the tax assessment letter.
Otherwise, the MAP should be accounted for the Objection Decision Letter.
• ►The administrative penalty of 50% of tax that is not paid prior to an objection will not apply if:
• Taxpayer withdraws the objection application.
• The objection application is not considered because it does not fulfill formal
requirement.
• Taxpayer applies for appeal to the Tax Court on the Objection Decision Letter.
This regulation revokes the previous regulation and enters into force from 1 March 2013. Since
the procedures are more detailed and sophisticated than the previous one, it is critical that
readers understand the new procedures.
Procedures to reduce or cancel
administrative penalty and to
amend or cancel Tax Assessment
Letters and Tax Collection
Letters (MOF Regulation Number 8/
PMK.03/2013 dated 02 January 2013)
The regulation provides new procedures for reduction or cancellation of administrative
sanction, or for amendment or cancellation of Tax Assessment Letters and Tax Collection
Letters as governed under Article 36 of the Law on General Tax Rules and Administration
(“UU KUP” or KUP Law). The regulation is to align the existing procedures with Government
Regulation No. 74 Year 2011. Highlights of the regulation are provided below:
•
•
•
•
►The application letter can be submitted electronically through the DGT website (www.pajak.
go.id) or an Application Service Provider (ASP). Taxpayer will receive an Electronic Receipt
upon the submission. This procedure of submission is called “e-Filing”.
►Taxpayer can only apply for one request and it cannot be done simultaneously with others.
Thus, it is critical that taxpayer who is seeking for cancellation or reduction under Article
36 of KUP Law reviews the options available for the most appropriate procedure.
►The application does not defer payment of tax and/or penalty requested for reduction /
cancellation.
►The DGT must issue a decision letter on the application within 6 (six) months from when
the application letter is received. If the DGT does not issue a decision letter after the
six month time-frame, the application is deemed accepted and the DGT must issue the
decision letter.
EY Indonesia Tax Insight | 01/2013
•
►
►The reduction on administrative sanction is applied retroactively from 31 December 2011
until 31 December 2013.
This regulation revokes the previous regulations and will enter into force on 1 March 2013.
Since the procedures are more detailed and sophisticated than the previous, it is critical that
readers understand the new procedures.
Facility of Import Duty Borne
by the Government for Year
2013 (MOF Regulation Number 7/
PMK.011/2013 dated 02 January 2013)
Natural Gas is not Subject to
VAT (MoF Regulation Number 252/
PMK.011/2012 dated 28 December
2012)
New Technical Guidance on Article
21 Withholding Tax (DGT Regulation
Number PER-31/PJ/2012 dated 27
December 2012)
The regulation provides an incentive of import duty borne by the Government on importation
by certain industries for the purpose to fulfill goods and/or services for the public interest,
consumed by the public, and/or to protect consumer, to increase certain industries’ local
competitive advantage, to increase labor absorption and to increase the country’s income.
The regulation also provides the detail procedures in obtaining the incentive from the
Government. This import duty facility is only valid until 31 December 2013.
The regulation defines the types of natural gas that are not subject to VAT on the basis that
VAT does not apply to mining or drilling products directly taken from their sources. This
includes natural gas supplied through pipeline; Liquified Natural gas (“LNG”); and Compressed
Natural gas (“CNG”). Liquefied Petroleum Gas (“LPG”) in canisters ready for consumption is
not included as natural gas that is not subject to VAT.
On 27 December 2012, the DGT issued new technical guidance to withhold income tax article
21 which came into force on 1 January 2013. The change is triggered by the adjustment on
Non-Taxable Threshold as governed under MOF Regulations No. 162/PMK.011/2012 and No.
206/PMK.011/2012. The changes on non-taxable income are summarized below:
•
•
•
The tax free threshold for taxpayer it is now IDR 24.300.000/year (or IDR 2.025.000/
month) and for each dependant and wife, it is IDR 2.025.000/year (or IDR168.750/
month);
The maximum limit of non-taxable income on wages paid to non permanent employees
is raised to IDR 200.000/day from IDR 150.000/day, or IDR 2.025.000/month from IDR
1.320.000/month;
The threshold for the application of the progressive income tax rates on wages is increased
to IDR 7 million/month from IDR 6 million/month. This means that wages below IDR 7
million per month will be subject to a flat tax rate of 5%.
This regulation revokes the DGT Regulation No. PER-31/PJ/2009 as amended by PER-57/
PJ/2009.
Change on Withholding Income
Tax Article 22 on Import or Other
Business Activity (MOF Regulation
Number 224/PMK.011/2012 dated
26 December 2012 and DGT Circular
Letter Number SE-02/PJ/2013 dated 31
January 2013)
MOF has issued a new regulation as an amendment to MOF Regulation No. 154/PMK.03/2010
regarding the collection of income tax under Article 22 of the Income Tax Law (“Income Tax
Article 22”) on import or other business activities. State Owned Enterprises where all or most
of their shares are directly owned by the Government are now appointed as collector of Income
Tax Article 22 on purchases of goods. The regulation also adds pharmaceutical companies,
sole distributors of cars (ATPM), brand holder agents (APM), and general importers of motor
vehicles as entities that are required to collect Income Tax Article 22 on their local sales.
Certain exceptions from collection of Income Tax Article 22 are provided to entities appointed
by the Ministry of Defense or the Army to provide boundary data and aerial photographs for
national defense, import of certain vessels by national companies for port services, rivers and
lakes transport services and crossing.
The regulation enters into force after sixty days of its issuance.
Timing for issuance of tax invoices
for Taxable Goods with specific
characteristics (MoF Regulation
Number 238/PMK.03/2012 dated 26
December 2012)
The regulation provides specific exceptions for certain taxpayers delivering taxable goods with
specific characteristics, as follows:
• having sales price that are subject to fluctuation in accordance with index / standard price in domestic or international market;
• quality or content of the products can be changed upon delivery or transportation process under normal condition; and/or;
• quantity of the products can be changed upon delivery or transportation process under normal condition
The regulation provides that concentrate of mining products containing minerals and chemical
products fall under the category of taxable goods with specific characteristics as governed
under this regulation.
EY Indonesia Tax Insight | 01/2013
It would appear that the regulation accommodates the potential change of sales value caused
by certain factors. For this reason, the regulation requires that the sales contract clearly defines
agreements between the seller and the purchaser on such potential price changes.
Tax invoices relating to delivery of taxable goods with specific characteristic are, at the latest,
to be issued when the revenue from the delivery can be completely calculated in final. However,
if payment is received before that, the tax invoice must be issued upon receipt of payment.
This regulation comes into effect 30 (thirty) days after its enactment.
Tax Deductibility of Bad Debt
Provision (MOF Regulation Number
219/PMK.011/2012 dated 21 December
2012)
Restructuring of Large Tax Offices,
Jakarta Special Tax Offices, and
Middle Tax Offices (DGT Regulation
Number PER-28/PJ/2012 dated 17
December 2012)
MOF amended Regulation No. 81/PMK.03/2009 regarding tax deductibility of bad debt
provision. Based on the new regulation, Lembaga Pembiayaan Ekspor Indonesia, PT
Perusahaan Pengelola Aset and infrastructure funding companies that provide funding to
infrastructure projects are allowed to claim tax deduction on bad debt provision. The regulation
amends determination of the tax deductibility of their bad debt provision for PT Permodalan
Nasional Madani (Persero). This regulation is effective from Fiscal Year 2012.
The DGT rearranges the structure of the Large Tax Offices, Jakarta Special Tax Offices, and
Middle Tax Offices. The Large Tax Offices now consist of four tax offices, two for private
companies and two for State Owned Companies. The Jakarta Special Tax Offices now consist
of 8 tax offices; one for Listed Public companies, six for Foreign Investment companies, one for
permanent establishments and foreigners in Jakarta area and one for taxpayers in the Oil and
Gas sectors.
The above tax regulation came into force on 1 January 2013.
VAT for First Generation Coal
Contract of Work (Berita Negara
Republik Indonesia No. 1255 Year
2012 – MoF Regulation Number 194/
PMK.03/2012 dated 6 December 2012)
On 6 December 2012, MoF issued Regulation Number 194/PMK.03/2012 regarding the
Procedures for Collection, Payment, and Reporting of Sales Tax and VAT and/or Luxury Sales
Tax Treatment for First Generation of Coal Contract of Work. This regulation takes effect from
1 January 2013. The contractors under the First Generation Coal Contract of Work are PT.
Arutmin Indonesia, PT. BHP Kendilo Coal Indonesia, PT. Kaltim Prima Coal, PT. Kideco Jaya
Agung, PT. Adaro Indonesia and PT. Berau Coal (“the Contractors”).
The regulation provides a significant change to the current VAT practice of the Contractors,
whereas under this regulation, the Contractors have the obligation to self collect, pay, and
report Sales Tax relating to services provided by vendors of the Contractors. Specifically for PT
Berau Coal, it is also obliged to self collect, pay and report Sales Tax on purchases of goods. The
rates of Sales Tax range from 1% to 5%. For the purpose of reporting, the regulation introduces
a Sales Tax Return for the Contractors, which are to be submitted at the end of the month
following the event triggering the Sales Tax. The Sales Tax itself is to be paid at the latest by the
15th of that month following the event triggering the Sales Tax.
Under this regulation, Value Added Tax and Luxury Sales Tax on the delivery of goods and
services provided to the Contractors are not collected. Thus, vendors to the Contractors are still
required to issue tax invoices on deliveries of taxable goods and/or services, but the tax invoices
are to be issued with the stamp describing “VAT AND/OR LUXURY SALES TAX (PPnBM) IS NOT
COLLECTED BASED ON MoF REGULATION NUMBER ……”
Annual Income Tax Return
Submission Procedures (DGT
Regulation Number PER-26/PJ/2012
dated 05 December 2012 and DGT
Circular Letter number SE-55/PJ/2012
dated 05 December 2012)
Starting 1 January 2013, the DGT changed its procedures for the submission of Annual Income
Tax Return. A summary of the major changes in the new procedures compared to the previous
procedures is as follows:
•
•
•
•
•
►Taxpayer who submits the Annual Income Tax Return directly to the Tax Office, Tax
Counter (“Pojok Pajak”), Tax Car (“Mobil Pajak”) or Drop Box is not required to use a closed
envelope or other packaging.
►The Annual Income Tax Return in the form of e-SPT should be directly submitted to the
Tax Office where the taxpayer is registered. The same procedure has previously applied
for Tax Return that showed an overpayment of tax, a Tax Return Revision, or a Tax Return
submitted after the deadline.
►Taxpayer that submits Tax Return in the form of e-SPT must ensure that the e-SPT is
completely filled in and consistent with the hardcopy and it must be submitted along
with the hardcopy. Otherwise, the Tax Return will be considered not complete and not
submitted.
►The Tax Office will issue the Correction Letter on the Annual Income Tax Return Receipt if
the Tax Office finds that the taxpayer has put the wrong Tax Identification Number in the
Annual Income Tax Return.
►The regulation also provides the procedures for the Tax Office to collectively receive the
Tax Return through Drop Box services, either at the taxpayer’s site or at the Tax Office.
PER-26/PJ/2012 has included the list of documents/information required to be attached to the
Annual Income Tax Return. These regulations revoke the previous tax regulations.
EY Indonesia Tax Insight | 01/2013
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