On 22 August 2020, the Indonesian Directorate General of Taxation has published Regulation No.110/PMK.03/2020 regarding tax incentives for certain taxpayers in industrial sectors affected by the coronavirus pandemic. The regulations increased the reduction of monthly corporate tax payments from a 30% reduction to a 50% reduction for qualifying taxpayers with effect from July 2020 to December 2020.
The incentives are available to taxpayers operating in over 1,000 sectors listed in the annexes to the regulation as well as taxpayers who have been granted the Import Facility for Export (KITE) purposes and taxpayers who have been granted a restricted zone license. To obtain this incentive, taxpayers must submit a notification online through www.pajak.go.id. Another provision regulated under the regulation for taxpayers in the construction services sector, which are generally subject to final income tax of between 2% and 6% depending on the scope of services. In particular, this will be provided for taxpayers participating in the program to accelerate the improvement of irrigation water use. This tax incentive will be borne by the government until December tax period.
