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Amazon, Google, and others contribute to Indonesia's Rp 6.76 trillion digital tax haul

Jakarta Globe - January 5, 2024

Arnoldus Kristianus, Jakarta – The Finance Ministry has collected Rp 6.76 trillion ($435.5 million) in value-added tax (VAT) and income tax obtained from digital companies and services operating in Indonesia in 2023. The digital tax, as it's commonly known, experienced a 22.69 percent growth compared to the Rp 5.51 trillion recorded in 2022.

Dwi Astuti, the Director of Education, Services, and Public Relations at the Directorate General of Taxation of the Ministry of Finance (DJP Kemenkeu), said that the government has cumulatively collected Rp 16.9 trillion in digital tax since its inception in 2020. The breakdown includes Rp 731.4 billion from 2020, Rp 3.9 trillion from 2021, Rp 5.51 trillion from 2022, and Rp 6.76 trillion from 2023.

According to Dwi, as of November 2023, the number of digital taxpayers remained steady at 163 companies. These companies include major tech companies like Amazon, Google, Facebook, Netflix, Apple, TikTok, Walt Disney, Microsoft, Valve, and others.

Digital services companies are obligated to pay an 11% VAT rate on foreign digital products sold in Indonesia.

Dwi said that to maintain fairness and equality between conventional and digital businesses, the government will persist in collecting taxes from digital entities engaged in selling products or providing digital services from abroad to Indonesian consumers.

The criteria for businesses subjected to digital tax encompass transactions exceeding Rp 600 million annually or Rp 50 million monthly with Indonesian consumers. Additionally, the number of transactions in Indonesia exceeds 12,000 annually or 1,000 monthly.

Source: https://jakartaglobe.id/tech/amazon-google-and-others-contribute-to-indonesias-rp-676-trillion-digital-tax-hau