- In an effort to increase sustainable economic growth and support the acceleration of Indonesia’s ongoing economic recovery, the government and the House of Representatives (Dewan Perwakilan Rakyat – "DPR") are currently finalizing the Draft Bill on the Harmonization of Taxation Regulations ("Draft Bill"), which will implement the following specific matters: 1) Amendment to general provisions and procedures on taxation; 2) Amendment to provisions on income tax; 3) Amendment to provisions on value-added tax (Pajak Pertambahan Nilai – "PPN"); 4) Introduction of provisions that address the taxpayer voluntary disclosure program; 5) Introduction of provisions on the new carbon tax; and 6) Amendment to provisions on excise.
- The Draft Bill is also set to remove several goods and services from the official list of items subject to PPN, specifically: 1) Mining products or drilling results taken directly from source; 2) Staple goods; 3) Healthcare services; 4) Social services; 5) Postage-stamp services; 6) Financial services; 7) Insurance services; 8) Educational services; 9) Non-advertisement broadcasting services; 10) Domestic public transportation services; 11) Labor services; 12) Coin-based public telephone services; and 13) Money transfer services that are implemented via postal money orders.
- Any carbon emissions that have a negative impact on the environment will be subject to the imposition of a carbon tax at a rate that is based on the carbon tax/market roadmap. This carbon-tax provision is set for introduction on 1 April 2022 and will apply initially to entities operating within the field of coal-fired power plants, which will be taxed at a rate of Rp. 30.00 per kilogram of carbon-dioxide equivalent (CO2e) or equivalent units.
- The Draft Bill is currently undergoing a process of internal deliberation conducted by the government and the DPR and thus may be subject to further changes.
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