IdEA issues proposal`s for eCommerce Taxation

Ilustrasi (dok)

JAKARTA (IndoTelko) - Indonesian eCommerce Association (IDEA) issues concrete proposal to the Indonesian government related to online commerce tax  plan according the tax's office circular note No. SE-62 / PJ / 2013 and SE-06 / PJ / 2015.

The government said to impose a tax on transactions in the online marketplace, classified ads, daily deals and online retail.

"There should be clear regulation about this tax for eCommerce or startups. Please understand, we do not avoid taxes, but an understanding is needed for the sector thatbis still on premature stage. If taxation is imposed immediately it is feared to threaten the transaction climate," said idEA Chairman Daniel Tumiwa yesterday.

He added that the government must know that there are a lot of eCommerce or start up players who are still in the starting phase and still not making profits. "If the taxation is forcely imposed, they would venture abroad because of more favorable conditions," he explained.

Daniel said that idEA has provided a concrete proposal to the government.  First, the assertion of the Directorate General of Tax that the treatment of any retail online sales transactions is similar to any other transactions. So that the treatment of Online Retail Sales Tax Invoice can use the regular reported invoice in accordance with Article 6.b on SE No. 98/2010.

The implementation of the Government Regulation (PP) No. 46/2013, which requires income tax for the e-commerce businesses who have a turnover of under 4.8 billion per year, according to idEA is not recommended to be applied. Also the income tax exemption for e-commerce who just established under 5 years.

Secondly, there is no need for examination vonducted by the Directorate General for e-commerce startup companies that established under 5 years and still losing.
Sellers who have a tax identification number, TIN, should also released from tax during their initial 3 years. After three years running their busines then the individual seller should be able to choose whether to be a Taxable Business Person (PKP) or use the rules of Regulation No 46/2013 which is taxed 1%.

Third, idEA also asked the government to disseminate the obligations to issue a Tax Invoice for individual sellers on the Marketplace sites. As well as the need to create a TIN database that can be accessed (via a web service or API) by the organizers of online transactions for verification needs of the seller.

Last, idEA is expecting the government to educate e-commerce players in stipulating the regulations according to the bussiness models in avoiding any mistakes and kill the newly born e-commerce industry. Government is asked to further reinforce the mandatory rules of law-making body for foreign e-commerce players who do business in Indonesia.

Further he said, other things needed by the eCommerce businesses is the ease of the government to run the service. For example, strengthening the logistics and infrastructure such as the Internet.

Most eCommerce players are still renting overseas data center in Singapore for as low as $ 28 million per year with a bonus of 20 TB of data. While in Indonesia, for the same quality data service can exceed $100 million per year.   

Understands
The Indonesian Minister of Communication and Informatics Rudiantara said that his institution understand the proposal by idEA and proposed to postponed the eCommerce taxation implementation.

"The government is considering to apply tax incentive in forms of post poning tax payment in supporting the e-Commerce growrh in Indonesia," he said.

The minister also said that the proposal have been taken into a discussion with related  ministerials, which expected to coordinate with the Fiscal Policy Body of the Finance Ministry for further analysis.(es)