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Slipsheet title hereShort descriptionTax News FlashOctober 2019
VAT Exemptions Now Available for Temporarily Imported Goods Utilized in Providing Taxable Services from Overseas
The Director General of Tax has finally issued technical guidance for the issuance of a Statement Letter of Utilization of Offshore Taxable Services (Surat Keterangan Pemanfaatan JKP dari luar Daerah Pabean di dalam Daerah Pabean/“SKJLN”), as stated in Article 3, Paragraph (4) of Ministry of Finance Regulation No. 178/PMK.04/2017, regarding Temporary Imports.
DGT Regulation No. 12/PJ/2019 (PER-12) provides clear procedures to be followed for VAT exemption applications when temporarily importing goods are utilized in providing taxable services from overseas.
To be eligible to apply for a SKJLN, a taxpayer (either individual or corporate) must already have submitted the following:
• Annual Income Tax Returns for the last 2 fiscal years; and/or
• VAT Returns for the last 3 fiscal periods as a VATable Entrepreneur.
After a complete application and required attachments are submitted to the Tax Office (“TO”) where the taxpayer is registered, the TO must review the documents and issue a decision letter of acceptance or rejection within three working days.
If the application is rejected, the applicant must pay all VAT and/or VAT & Luxury Goods Tax payable related to the import of the taxable goods. The taxpayer must settle the payment within 1 month after the issuance of the SKJLN Cancellation Letter. The VAT paid by a taxpayer can be treated as creditable input VAT.
If the taxpayer does not settle the VAT and/or VAT & Luxury Goods Tax payable, the TO will assess a 2% interest penalty per month, calculated from the time of import until the date of payment.
KPMG Comment:
• PER-12’s clear procedures and the quick turnaround time required by the TO are expected to increase the ease of doing business in Indonesia.
• There is no indication in the Regulation whether a taxpayer may reapply to obtain a SKJLN if the initial application has been rejected.
© 2019 KPMG Advisory Indonesia, an Indonesian limited liability company and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.
KPMG Advisory Indonesia Tax Services 33rd Floor, Wisma GKBI 28, Jl. Jend. Sudirman Jakarta 10210, Indonesia T: +62 (0) 21 570 4888 F: +62 (0) 21 570 5888
Abraham PierrePartner In Charge, Tax Services [email protected]
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The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavour to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation.
© 2019 KPMG Advisory Indonesia, an Indonesian limited liability company and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.
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