The Tax Directorate General of the Indonesian Finance Ministry waives value-added tax (PPn) towards some goods and services for Covid-19 handling. That was official statement of Tax Directorate General received by Antara news agency on Saturday, April 11 2020.
In the statement, it was mentioned that Indonesian government supported the availability of goods and meds needed in Covid-19 handling by waiving the value-added tax or the government pays it.
Such facility is given to government agency or institution, referral hospital, and other parties appointed to aid the Covid-19 handling for importing goods.
The goods that will not be subject to a 10 percent tax are medicine, vaccine, lab equipment, detecting equipment, protective gear, patient treatment equipment, and other supporting equipments.
Meanwhile, the services needed in Covid-19 handling include construction, consulting, engineering, management, rental, and other supporters.
Not only value-added tax, the regulation also exempts three income taxes (PPh). The first is Article 22 or Import Income Tax, for import of goods by government agency or institution, referral hospital, and other parties appointed to aid the Covid-19 handling. The Article 22 Income Tax exemption is also given to the seller.
Second, Article 21 Income Tax exemption will take effect to domestic individual taxpayer as payment given by government agency or institution, referral hospital, and other parties appointed to aid the Covid-19 handling.
Third, exemption of Article 23 Income Tax for income received by government agency or institution, referral hospital, and other appointed parties for engineering, management, or other kinds of services required in Covid-19 handling.
Reference proposal for Article 22 and Article 23 Income Taxes exemption is submitted to tax office head where the taxpayer is registered, through official email of the tax office.
Value-added tax and income tax incentive will take effect from April 2020 until September 2020.