On 30 December 2020, the Indonesian Ministry of Finance has issued a Regulation No. 237/PMK.010/2020 providing tax incentives for companies in special economic zones (SEZs).
Accordingly, a 100% reduction in corporate income tax, which may be granted for companies investing at least IDR 100 billion with the following conditions met: (i) for a 10-year period if the total investment plan is at least IDR 100 billion up to less than IDR 500 billion (ii) for a 15-year period if the total investment plan is at least IDR 500 billion up to less than IDR 1 trillion; and (iii) for a 20-year period if the total investment plan is at least IDR 1 trillion. A further 50% corporate income tax reduction is provided for two years after the end of 100% reduction.
Under the income tax facility, incentives are available for the investments in certain sectors or regions to a minimum investment of IDR 100 billion subject to certain conditions. The Regulation became into effect on 29 January 2021.
