Issues a new regulation on tax holiday

Effective April 2018, the Government introduced a new regulation (Regulation No. 35/PMK.010/2018) on Tax Holiday, as an incentive to conduct business in Indonesia. The new regulation provides greater convenience and more flexibility for investors to obtain a tax holiday by revising some of the previous requirements, such as the expansion of the number of pioneer industries (from 8 to 17 sectors) that can obtain the tax incentive. It also requires a lower minimum capital requirement and changes the legal form of investment from only the establishment of a new company to including an additional capital investment by an already established entity.

• Type:

  • Promotion and facilitation (Investment incentives)

• Industry:

  • Not industry specific

• Sources:

  • KPMG, Revised Tax Holiday Regulations More Attractive for Potential Investors, https://home.kpmg.com/id/en/home/insights/2018/05/id-tnf-may-2018-revised-tax-holiday-regulations.html, 23 May 2018
  • EY Global Tax Alert, Indonesia releases new regulations on tax holidays, https://www.ey.com/Publication/vwLUAssets/Indonesia_releases_new_regulations_on_tax_holidays/%24FILE/2018G_02140-181Gbl_ID%20releases%20new%20regulations%20on%20tax%20holidays.pdf, 11 Apr 2018