- In an attempt to maintain the purchasing power of the general public within the motor-vehicle industry, the Minister of Finance ("Minister") has issued the amendment to Regulation No. 31/PMK.010/2021 on Luxury Goods Sales Tax for Taxable Goods Categorized as Luxury Goods in the Form of Certain Motorized Vehicles Borne by the Government During the 2021 Budgetary Year, through the issuance of Regulation No. 77/PMK.010/2021 ("Amendment").
- The Amendment has now increased the rate of payable Luxury Goods Sales Tax (Pajak Penjualan Barang Mewah – "PPnBM") which is being borne by the government to 100% during the June 2021 - August 2021 tax period for the following types of vehicles: 1) Sedans or station wagons of up to a maximum capacity of 1,500 cc; and 2) Vehicles with passenger capacities of fewer than 10 persons, that utilize a single axle drive system (4 x 2) and that have a maximum capacity of up to 1500 cc. Previously, the rate of payable PPnBM which was to be borne by the government for the abovementioned types of vehicles during the June 2021 to August 2021 tax period was set at 50%.
- Provisions on the payable PPnBM amount for handovers of the above-listed types of motor vehicles came into force on 1 June 2021.
- Tax invoices that were drawn up for purchases of certain motorized vehicles during the June 2021 tax period and that used the previous rate of government-borne PPnBM should now be replaced. Moreover, any PPnBM and/or overpayment of value-added tax that has already been collected should be returned by relevant taxable business actors that conducted the collection.
- The Amendment has been in force since 30 June 2021.
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