Tax on Imported Films Resolved

Minister of Finance Regulation No. 102/PMK.011/2011 on Other Values as the Tax Retribution Basis for Intangible Taxable Goods Utilization inside Customs Area, in the form of Imported Films and Article 22 Income Tax Retribution for Imported Films (“Regulation”) has been issued to provide legal certainty about the value added tax retribution of imported films.

Article 1 stipulates various key terms that will be used throughout the Regulation. The terms are, among others, taxable goods (as elaborated on in Article 1 (2)); tax retribution basis (as elaborated on in Article 1 (4)); other value (as elaborated on in Article 1 (5)); and imported films (as elaborated on in Article 1 (6)).

Pursuant to Article 2 (1) of the Regulation, intangible taxable goods utilization, which  originated from outside the customs area, is subjected to value added tax (VAT). VAT, pursuant to Article 2 (2), will be collected when a film is imported. Moreover, Article  (5) stipulates that VAT will be calculated from the other value, which is set at IDR 12 million for each copy of an imported film.