Indonesia proposes to introduce VAT on e-commerce sales

1 August 2019

A VAT bill is currently being reviewed by the Indonesian government that will introduce VAT at 10% on all e-commerce goods and service transactions made by non-resident companies.

At present, non-resident businesses providing e-commerce supplies to Indonesia do not have to charge VAT on their sales. However, in an effort to remove the unfair advantage that this gives to non-resident companies over Indonesian resident providers, the Indonesian government are planning to introduce VAT at 10% on these types of transactions.

If introduced the new tax will be charged and collected by the non-resident suppliers, who will likely have to register for VAT in the country.

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