Indonesia |
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| Income Tax Rate | 5% - 30% | | Corporate Tax Rate | 25% | | Sales Tax / Service Rate | 10% |
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Personal Income Tax |
| Individual income tax rates are progressive rate between 5% - 30% as shown below: |
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| Taxable income (Rp) | Tax rate | | Rp 1 – 50,000,000 | 5% | | Rp 50,000,001 – 250,000,000 | 15% | | Rp 250,000,001 – 500,000,000 | 25% | | Rp 500,000,001 and above | 30% |
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Corporate Tax |
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| Indonesian firms are subject to corporate tax on all sources income regardless of where the income is derived. Foreign companies shall be considered taxable in Indonesia if they have a presence and conduct business in that country. In case of branches of foreign companies, the companies are taxed only on income derived in Indonesia. Taxable income for the companies shall be assessable income less tax deductible expenses. It is important to note that the tax payment paid to other countries is granted tax deduction in Indonesia. |
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| Corporate tax rates in Indonesia are levied as follows: |
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| Level of income | Tax rate | | Rp 50,000,000 and below | 10% | | Rp 50,000,001 – 100,000,000 | 15% | | Rp 100,000,001 and above | 30% |
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| The following is types of business subjected to special tax rates: |
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| Types of business | Tax rate | | Petroleum | 30% - 45% | | Mining site | 30% – 45% | | Construction | 2% | | Building Design | 4% | | Tax and legal consultant | | Multinational shipping company and foreign airlines | 2.64% |
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Value Added Tax/ Sales Tax |
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| Generally, value added tax for imported and exported good produced in Indonesia is 10%. However, some imported raw materials are granted value added tax exemption. These include raw material used in the production of banknotes and coins, fodder, marine and air vehicle weapons, science book, software medical tools and raw materials used in the production of ship and airplane. |
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Withholding Tax |
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| Types of taxable income | Tax rate | | For resident | For non-resident | | Dividend | 10% | 20% | | Interest | 15% | 20% | | Royalty | 15% | 20% | | Technical assistance and Service Fee | 2% | 20% |
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| Indonesia does not levy any withholding tax on dividend and there is no Capital Gains Tax. |
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Tax Incentives for SMEs |
| SME companies with income not exceeding Rp 600 million per year are not subject to value added tax. However, Young Entrepreneurs Association (Hipmi) in Indonesia is currently enhancing yearly ceiling income from Rp 600 million to Rp 2,500 million in order to assist SME business owners. In addition, dividend derived from the business jointed with Indonesian SMEs is exempt from tax. |
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