TAX UPDATE
January 2021

Creation Job Law (UU Cipta Kerja/Omnibus
Law):
Major Changes to Tax Laws
Law No. 11 year 2020 (“11/2020”)

The Indonesia parliament approved the Omnibus Law on 5 October 2020 and it was signed by
the President on 2 November 2020. The Omnibus Law consist of 11 clusters, 15 chapters and 186
articles. This Tax Update covers the major changes to tax laws, i.e. General Tax Procedures (KUPLaw), Income Tax Law, and VAT Law.

I) General Tax Provision Law (KUP Law)
Article14 (4)

Regarding
Administration
Penalty••27B (2)

No Issuance/Late
Issuance of VAT Incoie
Incomplete VAT Invoice

Interest
Compensation The

Overpayment Tax Return

Interest
Compensation The

27B (3)8(2), (2a), &(5)9(2) & (2b),13(2) & (2a),14(3),19(1), (2) &(3),Decision of amendment,
reduction or cancellation ofTax Assessment Letter or Tax
Collection Letter

Interest Penalty(the late payment; theadditional tax payable due
to self
disclosure/amendment of tax
return, Underpaid Tax
Assessment Letter)

New Law

Old Law

1% Penalty of the VAT Base

2% Penalty of the VATBase

Interest compensation isgrantedforthetax
overpayment
amountagreed in the closing
conference.

It was regulated in theGovernment Regulation of
KUP Law

Interest compensation isgranted for max 24 months
based on the floating rate
determined by the Ministryof Finance (MoF).

It was regulated in theGovernment Regulation of
KUP Law

The penalty is calculated
based on the floating rate
determined by the MoF in amonthly basis for themaximum of 24 months.

2% per month

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Ciputra World 2 Jakarta, Jl. Prof. Dr. Satrio Kav. 11Fax: +62 21 2521 335
Jakarta Selatan 12940

www.ssjkconsulting.com

TAX UPDATE
January 2021

2) Income Tax Law
ArticleRegarding

New Law

Old Law

2 (3) pointc

Category of Tax
Subject

The undistributed legacy isclassified as domestic Tax
Subject.

N/Aa)
b)

2 (4)

4 (1a)

4 (2) pointfCategory of Offshore
Taxpayer

Exception of Tax
Object for theExpatriate

Dividend is excluded
from the Tax Objectc)

Individual not staying inIndonesia.
ForeignerstayinginIndonesia less than 183
days within 12 months.
Indonesian citizen staying
outside Indonesia morethan 183 days within 12months.

a)b)Individual not staying
in Indonesia.
Individual not staying
in Indonesia morethan 183 days within
12 months.

Foreigner
who
becomeIndonesia Taxpayer is only
taxed for the income fromIndonesia, as long as:• Having a specific skill• Having been applicable forthe first 4 years after
becomingIndonesia
Taxpayer

The Foreigner who
become Indonesia
Taxpayer should reportall of income in Indonesia(world-wide incomeconcept).

a)

Dividend from Indonesiancompany received by:• Indonesian individual
who re-invested thedividend in Indonesia
for certain period• Indonesian corporate
taxpayera)b)Dividend from outside
Indonesia received byIndonesian individual or
corporate taxpayer, aslong as:• Dividend is invested inIndonesia at least
30% from the profit
after tax.
• The DGT has notissuedtheTaxAssessment Letter on
the dividend.

Dividend fromIndonesian company
received by:• Indonesian
individualissubject to 10%
Final Tax
• Indonesian
corporatetaxpayer(shareholdingless than 25%)b)

Dividend from outside
Indonesia received byIndonesian individual
or corporate
taxpayer should bereported in theannual tax return andsubject to the normal
tax treatment.

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January 2021

3) Value Added Tax Law
ArticleRegarding

New Lawa)

1a (1) &(2)Delivery of goods not
subject to VAT

4A (2)

Goods/services not
subject to VAT

9 (2a) &(6a)Claiming Input VAT for
the VAT Entrepreneur
who has not started
the commercial
operationb)

Claimable Input VAT

13 (5)

b)

Consignmentofgoods is subject toVATTransfer of goods forthe capital injection is
subject to VAT.

Coal is not subject to VAT.

a)

The VAT Entrepreneur whohasnotstarted
thecommercial operation canclaim all Input VAT.

a)b)

The VAT Entrepreneur
shouldstartthecommercialoperation
within 3 years otherwise
the Input VAT should be
paid back.

b)c)Additional
Administrative
Requirement for VAT
Invoicea)

Coal is subject to VAT.

a)9 (9a),(9b), (9c)Consignment of goods is
no longer subject to VAT
Transfer of goods for thecapital injection, as longas the transferor and therecipientisVAT
Entrepreneur.

Old Law

Input VAT before theTaxpayer becomes VATEntrepreneur(themaximum of 80% Output
VATthatshould becollected).
Input VAT found during
the tax audit.
Input VAT imposed in theTax Assessment Letter(having been paid).

The VAT Invoice to Individual
can be replaced with the
Residential
Number(NIK)/Passport, except theoffshore company.

b)

The VAT Entrepreneur
who has not started
thecommercial
operation can claim
theInput
VATfromtheacquisitionofcapital
goodsonly.
The VAT Entrepreneur
shouldstartthecommercial operationwithin
2yearsotherwise the Input
VAT should be paidback.

The Input VAT under those
3 conditions could not beclaimed.

N/APage 3

TAX UPDATE
January 2021

New Stamp Duty(“Bea Meterai”)

Law No 10 year 2020

The Indonesia Government has passed the Law No 10 year 2020 on 26 October 2020 regarding
the Stamp Duty.
This Law revokes the old Law No. 13 year 1985. The key features of Law No. 10 year 2020 is asfollows:
NoKey Features

Law No. 10 / 2020

IDR 10,000 for the document mentioning value more than IDR 5 million.
Previous Law No.13/1985:
IDR 3,000: for the document mentioning value of IDR 250,000 up to IDR 1million.
IDR 6,000: for the document mentioning value more than IDR 1 million.

1Stamp DutyValue

2Effective
Period1 January 2021

3TransitionPeriod

The old Stamp Duty with value of IDR 3,000 and IDR 6,000 can be used until
31 December 2021, and it is remained to be used with total value of minimum
IDR 9,000, i.e. IDR. 6,000 + IDR.3,000 OR 3 X IDR.3,000 OR 2 X IDR.6,000

Page 4TAX UPDATE
January 2021

For additional information, please contact
us:Meliana Djajakarto – Director
meliana@ssjkconsulting.com
Stefanus Kurniadi – Director
stefanus@ssjkconsulting.com
Susanty Judohartono – Director
susanty@ssjkconsulting.com
SSJK Consulting
Tokopedia Tower, 8th Floor, Unit A
Ciputra World 2 Jakarta
Jl. Prof. Dr. Satrio Kav. 11
Jakarta Selatan 12940
Phone: +62 21 2521 337
Fax: +62 21 2521 335
www.ssjkconsulting.com

The information in this document is intended for general information only based on our understanding of theinterpretation of those provisions. There is no guarantee the Tax Office will have the same view from thoseexpressed in this document. When specific problems occur in practice, it is suggested to obtain appropriate advice
from the tax advisor.
Page 5