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Every expert projected that Netflix would reap a huge profit in Indonesia. However, before we are talking about profit, let's talk about tax, said IT Minister and Finance Minister, Johnny G. Plate & Sri Mulyani Indrawati. (Image via TechCrunch)
IT Minister to discuss Netflix's tax in Indonesia with Finance Minister
The Minister of Communication and Information Technology, Johnny G. Plate, said that he would discuss with the Minister of Finance, Sri Mulyani Indrawati, regarding tax for American streaming and video-on-demand service provider, Netflix. The IT Minister said that he demanded Netflix to be in Indonesia as soon as possible. However, talks about its tax in Indonesia has to be done.Speaking to the press on Thursday, Plate said that he had to discuss with Sri Mulyani how the legal standards, the tax tariff, and the technical mechanism of the tax imposed on Netflix. Also, he expected that the tax and Netflix will have a “happy ending”.
The imposing of tax is important for Indonesia and Netflix. Plate said that Netflix would reap a huge benefit in Indonesia. Therefore, Indonesia deserves a part of the benefit. He also stated that it is a common occurrence that a country encounters problems when it comes to imposing a tax on a digital company.
Sri Mulyani also agreed. Netflix, as a permanent establishment (PE) with many activities, hails a significant economic presence. The Finance Minister quoted that the neighboring countries such as Singapore and Australia already have their “Netflix Tax” regulated.
Australia is investigating Netflix’s tax record. In 2018, Netflix only paid less than 1% of its tax obligation. From US$600 million – US$1 billion profit in the Australia region, Netflix only paid US$340,000 or 0.06% of tax.
Source: https://bit.ly/33bPOtS
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