E-commerce Businesses Urge Government for a Fair Tax Regulation

TEMPO.CO, Jakarta - Online marketplace or E-commerce owners requested the Indonesian government to offer an equal regulatory treatment regarding taxation once it takes effect. One of the founders of Bukalapak.com Muhamad Fajrin explained that marketplace based e-commerce and social media e-commerce should be treated equally.

Fajrin reasons that the current thriving e-commerce businesses are not only participated by businesses joining an online store platform but also people that utilize social media as a vessel for their business. He openly admits that he is worried that by presenting tax rates into the equation would scare businesses that are already in the marketplace back to utilizing social media.

Fajrin is not overly optimistic that social media businesses will be taxed by the government, which will only diminish people’s interest in opening an online store through an existing marketplace.

Read: Indonesian E-Commerce Potentially Bigger Than Korea, India

Directorate General of Taxation Spokesman urged e-commerce businesses to wait for the issuance of Finance Minister’s Regulation (PMK) that will explain about the tariff regulation in detail which will be issued by the end of this week.

Previously, the Directorate General of Taxation issued a circular letter on e-commerce affirmation of taxation provisions. There will be four business models that will be taxed according to the letter, which includes the marketplace, classified ads, daily deals, and online retailers.

On a separate occasion, the Directorate General of Taxation Ken Dwijugiasteadi said that the Finance Minister’s Regulation on e-commerce tax rates will be placed under the value-added tax, which basically means that the e-commerce tariff is set at 10 percent.

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