- Indonesia’s digital economy sector is currently enjoying a period of significant development and growth, and has been projected to top USD 130 Billion by 2020. However, a number of issues still remain to be attended to, particularly the matter of taxation.
- Data provided by the INSEAD Global Talent Competitiveness Index indicates that Indonesia currently ranks 90 out of 118 countries in terms of its competitiveness. In order to improve this ranking, the following areas require urgent attention: 1) Tax revenues sourced from activity within the digital economy, however any applicable tax regime should take the principles of caution, proportionality and fairness into account; 2) Establishment of a regulatory and supervisory framework which addresses the collection of value-added tax from taxpayers; 3) Optimization of potential tax revenues generated by the over-the-top service sector; 4) Determination of the overall direction of taxation policy; 5) Optimization of the implementation of value-added tax for digital cross-border service transactions; 6) Creation of an Internet portal which utilizes a universal language for the purposes of registrations, submissions and the reporting of value-added tax.
- For more on this story, see Hukumonline: “Pajak Ekonomi Digital Di Mata Pengamat”
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