Kedutaan Besar Republik Indonesia
Embassy of the Republic of Indonesia
Ambassade de la RÉpublique d'Indonésie

Indonesia announces simpler regulation on tax holiday

The Indonesian government on Monday announced that it would soon enact a new regulation on a tax holiday to simplify the procedure to allow investors to obtain the fiscal facility.

Robert Pakpahan, the director general of taxation, said the new regulation would be signed by Finance Minister Sri Mulyani Indrawati and it would be implemented soon.

Under the new regulation, old investors would obtain a tax holiday if they expanded their businesses, Robert added.

a�?Under the old regulation, the tax holiday was only for new investors, but under the new policy it will be for new investments as well,a�? said Robert, as reported byA�

He added that under the old regulation, the range of a tax holiday had been between 10 to 100 percent, but under the new regulation it would be only be a single rate, namely 100 percent.

The third difference is that under the old regulation, the tax holiday had been given every five to 15 years, while under the new regulation there would be different thresholds based on the value of the investments, Robert said.

The fourth new regulation will be a transitional period of two years during which investors only get a 50-percent income tax cut. a�?After that period, they will get a 100-percent income tax cut,a�? he added. (bbn)

Source: The Jakarta Post