The Indonesian government has officially assumed the authority to tax digital companies operating in the country following the issuance of a new government regulation in lieu of law (Perppu) on Tuesday.
The Perppu, which takes effect on Tuesday and aims to support the government’s efforts to fight the adverse economic impacts of the COVID-19 pandemic, states that the companies will be charged value added tax (VAT) on taxable intangible goods and/or services sold through electronic platforms.
The government also charges income tax or electronic transaction tax on e-commerce activities carried out by foreign individuals or digital companies with a significant economic presence, according to Article 6.
Source: thejakartapost.com
