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Google Indonesia Ready to Collect 10 Percent Tax From Users

Google Indonesia claims to be ready to levy a value-added tax (VAT) of 10 percent to clients if requested by the government. The collection will be carried out after the digital tax regulation is enacted, namely August 2020.

"We will charge a 10 percent service tax to our clients in Indonesia after the relevant provisions come into force," said Google Indonesia Head of Corporate Communication Jason Tedjasukmana to CNNIndonesia.com, Wednesday (1/7).

Jason claims Google always complies with tax laws that apply in all countries. Therefore, the company will also follow the policies set by the Indonesian government.

"We comply with tax laws in all countries where we operate and continue to do so in line with changes in existing tax laws. To comply with the new VAT rules in Indonesia, if required, we will charge clients," explained Jason.

Meanwhile, the Director of Counseling, Services, and Public Relations of the Directorate General of Tax (DGT) of the Ministry of Finance Hestu Yoga Saksama said there were several criteria set for e-commerce players to collect VAT for overseas digital products.

One of them is a business actor who has a transaction value of selling digital products to buyers in Indonesia in excess of Rp600 million in a year or Rp50 million in a month.

"Criteria can also have the amount of traffic or access in Indonesia exceeding 12 thousand in one year or 1,000 in one month can be appointed as a VAT collector," said Hestu.

Later, DGT Ministry of Finance will appoint e-commerce businesses that are required to collect VAT. However, companies that are not appointed can submit it to the DGT of the Ministry of Finance.

"With the above criteria, the appointment of VAT collectors is based solely on the magnitude of the value of transactions with buyers in Indonesia, or the amount of traffic or access from Indonesia regardless of the domicile or jurisdiction of the place of business," explained Hestu.

He said business actors appointed as VAT collectors were required to withdraw VAT the following month after the decision was issued. It's just that, Hestu states the collection of VAT does not apply to goods or services that if under the law (uu) are excluded or exempt from the imposition of VAT.

Source: https://bit.ly/2AklsvZ