Domestic taxpayers who open a new business or expand their existing businesses in labor intensive sectors could enjoy a net income tax deduction of 60% of the capital they invested as fixed assets
Vocational Training Program
200%
Domestic taxpayers who conduct working program, interships and or educational activities to develop human resources based on certain competency could obtain a gross income tax deduction as high as 200 percent of the funds they had spend for the activities
Research & Development
300%
Domestic taxpayers who conduct R&D in Indonesia could obtain a gross income tax deduction as high as 300 percent of the cost of their R&D activities
Tax Holiday
(MoF Regulation No.130/PMK.010/2020 )
Requirement:
Minimum investment valued IDR 500 billion
Applied to 18 industry groups
100% reduction rate (single rate)
50% CIT reduction for the next 2 (two) years
Mini Tax Holiday
(MoF Regulation No.130/PMK.010/2020)
Requirement:
Minimum investment valued between IDR 100 and IDR 500 billion
Applied to 18 industry groups
50% reduction rate (single rate)
25% CIT reduction for the next 2 (two) years
18 industries entitled to apply tax holiday in Indonesia
Automotive industry and its main components including electric vehicle.
Basic inorganic chemical industry.
Digital economy data processing, hosting and its related activities.
Economic infrastructure including a power plant, a toll road with low IRR, a seaport with low IRR, oil tanking, TOD.
Industrial manufacturing of irradiated, electromedical or electrotherapy equipment.
Industrial manufacturing of main components for electric power generation machinery.
Machinery industry, the making of main engine or components for machine.
Main components for electronic industry or telematics equipment, such as semiconductor wafers, lcd, etc.
Main raw material for the pharmaceutical industry.
Manufacture of the main component for aircraft and supporting activities for the aerospace industry.
Manufacture of the main component for train.
Oil & gas refining without or integrated with its derivatives industry.
Organic based chemical industry sourced from agricultural, plantation or forestry products.
Petrochemical industry from oil, gas, or coal, without or with derivative.
Processing industries based on agriculture, plantation, or forestry products, with or without its derivatives.
Robotic component industry for manufacturing machinery industry.
Shipbuilding industry and manufacture of its main component.
Upstream base metal industry / smelter (iron steel or others).
Tax Allowance
Government Regulation No. 78 / 2019
Ministry of Finance Regulation No. 96/2020
Update: The granting of Income Tax Facility is carried out by the Chairman of BKPM on behalf of the Minister of Finance.
Criteria:
Absorbing certain numbers of local labour
Certain value of investment for export oriented industries
Using certain percentage of local content
Incentive Scheme:
Accelerated depreciation of tangible fixed assets and accelerated amortization of intangible assets
Imposition of Income Tax on dividends of 10%
Compensation for losses of more than 5 years but not more than 10 years
Benefit:
30% of the investment value in the form of tangible fixed assets
Reduction of corporate net income tax for 6 years, 5% each year
Tax allowance offered for investment in 183 business activities
Oil &GasIndustry
Oil refinery
Liquefied Natural & Petroleum Gas
Lubricant
PowerGeneration
Geothermal
Alternative/renewable energy
Agriculture
Cattle breeding & Farming
Corn plantation
Soya plantation
Rice Farming
Tropical Fruits
Manufacturing &Industry
Iron & Automotive Ind,
Steel
Clothing
Semi Conductors
Electronic Components
Computer
Communication Devices
Television
Tires
Pharmaceutical
Cosmetics
Fish & Shrimp processing
Import Duty Facility
MoF Regulation No.66/PMK.010/2015 Chairman of BKPM Regulation No. 16/2015
Criteria:
Exemption of import duty on imported capital goods (machines) for 2 years during construction period.
Exemption of import duty on imported goods and material for production for 2 years during initial production (or 4 years for companies using locally-produced machines min.30% from total value of machines for production).
Equitable and Non discriminatory treatment against country of origin