TAXATION
1. Income Tax
Income tax in Indonesia is progressive and applied to both individual (s) and enterprises. A self-assessment method is used to calculate the tax.
The Tax Rates per Individual (s) |
|
Taxable annual income |
Income tax rate |
| Up to Rp.25 million | 5% |
| Over Rp. 25 million to Rp. 50 million | 10% |
| Over Rp. 50 million to Rp. 100 million | 15% |
| Over Rp. 100 million to Rp. 200 million | 25% |
| Over Rp. 200 million | 35% |
The Tax Rates per Enterprise (s) |
|
Taxable annual income |
Income tax rate |
| Up to Rp.50 million | 10% |
| Over Rp. 2550 million to Rp. 100 million | 15% |
| Over Rp. 100 million | 30% |
2. Losses
Basically the government provides a loss carried forward facility for a period of 5 (five) years.
3. Avoidance of Double Taxation Agreements
To avoid incidental double taxation on certain income such as profits, dividends, interests, fees, and royalties; Indonesia has signed agreements (tax treaties) with more than 50 countries as follows:
No. |
Country name | No. |
Country name |
1. |
Algeria | 29. |
Norway |
2. |
Australia | 30. |
Pakistan |
3. |
Austria | 31. |
Philippines |
4. |
Belgium | 32. |
Poland |
5. |
Bulgaria | 33. |
Romania |
6. |
Brunei Darussalam | 34. |
Russia |
7. |
Canada | 35. |
Saudi Arabia |
8. |
Czech Republic | 36. |
Seychelles |
9. |
China | 37. |
Singapore |
10. |
Denmark | 38. |
Slovakia |
11. |
Finland | 39. |
South Africa |
12. |
Egypt | 40. |
Spain |
13. |
France | 41. |
Sri Lanka |
14. |
Germany | 42. |
Sudan |
15. |
Hungary | 43. |
Sweden |
16. |
India | 44. |
Switzerland |
17. |
Italy | 45. |
Syria |
18. |
Japan | 46. |
Taipei |
19. |
Jordan | 47. |
Thailand |
20. |
Republic of Korea | 48. |
Tunisia |
21. |
Democratic People’s of Korea | 49. |
Turkey |
22. |
Kuwait | 50. |
Ukraine |
23. |
Luxembourg | 51. |
Uni Arab Emirate (UEA) |
24. |
Malaysia | 52. |
United Kingdom |
25. |
Mexico | 53. |
United States of America |
26. |
Mongolia | 54. |
Uzbekistan |
27. |
Netherlands | 55. |
Venezuela |
28. |
New Zealand | 56. |
Vietnam |
Withholding tax rates applied to residents of these countries signing tax treaty with Indonesia, may be reduced based on the provisions of the particular tax treaty.
Source: Indonesian's Investment Coordinating Board