Highlights from the Indonesian Tax Amnesty Law

The tax amnesty program is available from 1 July 2016 until 31 March 2017

All taxpayers can apply for the amnesty, except those who are undergoing criminal charges or/and involved in an on-going legal settlement.

What is the facility?
  • Income tax and VAT is exempted on the declared/ repatriated asset if we pay the following redemption fee:
    • 2%/ 3%/ 5% redemption rate until Sept 2016/ Dec 2016/ March 2017 respectively for declared/repatriated assets that are invested for at least 3 years in Indonesia; or
    • 4%/ 6%/ 10% redemption rate until Sept 2016/ Dec 2016/ March 2017 respectively for declared/repatriated assets that are not invested in Indonesia.
  • No tax audit for fiscal years covered in the amnesty.
What should we do if we want to apply?
  • After paying the redemption fee, submit the application.
  • Should invest by 31 Dec 2016 and March 2017 for category of 2% & 3% and 5% redemption rates respectively for repatriated assets that will be invested in Indonesia.
  • Should cancel any on-going refund/reconsideration request or on-going tax dispute resolution.
How quickly will the Government process our application?

Within 10 working days after the application is received.  The application will be deemed to be approved if the deadline passes without any decision.

Where to invest the declared/repatriated funds?
  • Government/ state owned companies’ bonds
  • State-run development institutions
  • Financial investment at appointed banks
  • Stock market
  • Real estate investment trust (REIT/DIRE)
  • Mutual funds
  • Investment in infrastructure projects
  • Real sector investments pre-determined by the government

 

Please contact us for further details.