Selasa, Maret 2, 2021

Government to Grant Tax Incentives to Automotive and Property Industries

As part of efforts aimed at accelerating economic recovery across Indonesia, the government is hoping to boost the country's consumption rate through the granting of various fiscal incentives, including to the automotive and property industries.
In terms of the automotive industry, the above-mentioned incentives are specifically addressed under Regulation of the Minister of Finance No. 20/PMK.010/2021, which encompasses the following areas: 1) Reduction in Luxury Goods Sales Tax (Pajak Penjualan atas Barang Mewah/PPnBM) tariffs for motor vehicles that meet certain criteria (i.e. 4 x 2 sized sedans with maximum engine capacities of 1,500 cc), provided that the minimum local purchase rate is 70% in accordance with Decree of Minister of Industry No. 169 of 2021; and 2) The imposition of government-borne Value-Added Tax (Pajak Pertambahan Nilai – “PPN”). The amounts of said PPN that will be borne by the government differ based on the relevant imposition stages (i.e. during the first stage [March – May 2021 tax period]: 100%; during the second stage [June – August 2021 tax period]: 50%; during the third stage [September – December 2021 tax period]: 25%).
Meanwhile, in terms of the property industry, the above-mentioned incentives will be granted in the form of government-borne PPN for landed houses and apartment units. These incentives will be provided for six months commencing March 2021 as follows: 1) 100% government-borne PPN for landed houses or apartment units up to a maximum sales price of IDR 2 billion; 2) 50% government-borne PPN for landed houses or apartment units up to a maximum sales price of IDR 5 billion. These property-industry incentives will be specifically addressed under a forthcoming regulation.

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As part of efforts aimed at accelerating economic recovery across Indonesia, the government is hoping to boost the country's consumption rate through the granting of various fiscal incentives, including to the automotive and property industries.
In terms of the automotive industry, the above-mentioned incentives are specifically addressed under Regulation of the Minister of Finance No. 20/PMK.010/2021, which encompasses the following areas: 1) Reduction in Luxury Goods Sales Tax (Pajak Penjualan atas Barang Mewah/PPnBM) tariffs for motor vehicles that meet certain criteria (i.e. 4 x 2 sized sedans with maximum engine capacities of 1,500 cc), provided that the minimum local purchase rate is 70% in accordance with Decree of Minister of Industry No. 169 of 2021; and 2) The imposition of government-borne Value-Added Tax (Pajak Pertambahan Nilai – “PPN”). The amounts of said PPN that will be borne by the government differ based on the relevant imposition stages (i.e. during the first stage [March – May 2021 tax period]: 100%; during the second stage [June – August 2021 tax period]: 50%; during the third stage [September – December 2021 tax period]: 25%).
Meanwhile, in terms of the property industry, the above-mentioned incentives will be granted in the form of government-borne PPN for landed houses and apartment units. These incentives will be provided for six months commencing March 2021 as follows: 1) 100% government-borne PPN for landed houses or apartment units up to a maximum sales price of IDR 2 billion; 2) 50% government-borne PPN for landed houses or apartment units up to a maximum sales price of IDR 5 billion. These property-industry incentives will be specifically addressed under a forthcoming regulation.

......

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