International VAT Guides – Indonesia
| Standard Tax Rates | VAT Reporting Frequency | VAT on Cross-Border Electronically Supplied Services | Tax Authority | Digital Reporting Foreign Providers of Digital Services | Reporting Currency |
| 12% | Monthly | Yes | Directorate General Of Taxes | No | IDR or USD |
VAT rates in Indonesia
How much is VAT in Indonesia?
The Indonesia VAT regulatory framework for non-resident digital service providers has been in effect since July 1, 2020. For more than six years, one of the most populous Asian countries has had a specifically designed VAT regime for digital service providers in place.
Indonesia VAT regime for non-resident digital service providers is multilayered and is continuously being reshaped. The first major update came into effect in May 2025, when the Regulation issued by the Ministry of Finance introduced relevant changes concerning the VAT reporting rules, new VAT rate, new VAT registration/deregistration requirements.
The principal regulations that regulate this framework are the Ministry of Finance Regulation No. 48/2020 and the Director General of Taxes Regulation Number PER-12/PJ/2020.
Indonesia’s standard VAT effective rate is 11%. It applies to general goods, services, and digital services. This calculation logic is processed through the application of the 12% statutory rate to a reduced tax base calculation of 11/12 of the transaction value.
| Indonesia VAT Rate | Rate Type | Coverage and imposition |
| 12% | Standard Rate | The general VAT rate applies to all taxable supplies of goods and services for which the reduced or special rate cannot be imposed.e.g., Remote services |
| 12% | Luxury Goods Rate | Certain luxury items, such as high-end vehicles, private aircraft, and luxury properties, are taxed at the full, unadjusted 12% rate |
| 0% | Zero Rate | export of goods; export of certain services; |
| Tax-Exempt | Tax-exempt | education services, supply of financial services, supply of medical services |
VAT Threshold in Indonesia
The VAT Indonesia Law, Ministry of Finance Regulation No. 48/2020 and the Director General of Taxes Regulation Number PER-12/PJ/2020(later revised through Director General of Taxes Regulation (PER) Number PER-12/PJ/2025) are the cornerstone of the VAT framework for non-resident providers of digital services.
The rules for VAT threshold in Indonesia for non-resident digital service providers have been updated on several occasions, and the currently applicable rules indicate the following changes:
VAT registration threshold for resident businesses: IDR 4.8 Billion
VAT registration threshold for non-resident businesses: depends on the activity
VAT registration threshold for foreign providers of digital services:
- Economic nexus of IDR 600,000,000 annually or IDR 50,000,000 (fifty million rupiah) monthly and/or
- The number of users or traffic on its website from Indonesia exceeds 12,000 annually or 1,000 monthly.
VAT Taxable Activities in Indonesia
Types of taxable activities that mandate VAT registration:
- Supply of goods and services for consideration;
- Supply of digital services by non-resident providers
- Exports;
- Imports of goods and services
Tax Representative in Indonesia
Non-resident providers of digital services and/or intangible products have an option to register independently on VAT in most of the circumstances. In many cases the registration comes after the Revenue Authority has officially informed the digital service provider or online merchant to register for Indonesia VAT after surpassing the threshold.
Tax registration
Non-resident providers of digital services or electronic distribution platform operators should register for VAT in Indonesia online or on their own initiative or after being informed ex officio of their responsibility to register after surpassing the threshold.
VAT on Electronically Supplied Services in Indonesia
Digital Services
Indonesia has put in place a more than six years ago, the VAT framework for non-resident digital service providers. This framework is widely conceptualized through the abbreviation PMSE(“Trade Through Electronic Systems”).
From this date, the accountable VAT persons should register for Indonesian VAT to be able to collect, report, and remit VAT. The party responsible for VAT collection in these instances shall be the digital service provider appointed by the Ministry of Finance, as a Designated Party(VAT Collector).
The appointment of the accountable VAT collectors shall be an administrative procedure handled by the Revenue Administration and Ministry of Finance.
Non-resident providers of digital services should charge, collect, and remit VAT for all taxable supplies of digital services and/or intangible goods, whereas their customer is local consumer or local entity.
How much is VAT in Indonesia for Electronically Supplied Services?
VAT rate in Indonesia for digital services is 12%, and it’s called a statutory rate. However, for calculator of VAT payable, the effective rate shall be 11%, as a consequence of the calculation logic. The calculation logic says the following – the 12% rate is calculated by using Other Value as Tax Base i.e.,fraction 11/12, resulting in an ’effective‘ VAT rate of 11% for most taxable goods and services.
Taxable Digital Services in Indonesia
The following types of digital services are taxable:
- Audio and video streaming services
- SaaS services
- Intermediation platform services
- Payment facilitation services
- Cloud computing services and storage
- Online advertising
- Software and applications
- Marketplaces and e-commerce
- Online gaming and betting
Marketplace and Digital Platform Operators’ Rules
The operators of digital platforms and marketplaces are part of the Indonesia VAT regime. In the circumstances when the domestic or foreign platform operator is appointed as the VAT collector, that operator has the accountability to charge, collect and remit VAT on all facilitated transactions via its platform.
When the platform operator, acts as the “deemed supplier”, the foreign supplier is free of the VAT accountability for the transactions facilitated by the platform operator.
Invoicing Rules
VAT collectors are mandated to issue a commercial document for accounting purposes for their B2C, and B2B transactions. For B2B transactions, the commercial invoice should have more details than the B2C receipt, as it must contain the business name and TIN number of the local buyer, so the buyer can claim input tax on these transactions.
Foreign Currency Invoice in Indonesia
Foreign merchants, foreign service providers, and foreign marketplace operators could issue an invoice in the foreign currency, as they are permitted to submit a periodic tax return in USD.
VAT Returns in Indonesia
Simplified Return
Foreign providers of digital services should register online following the simplified procedure or after being appointed for registration by the responsible tax authorities.
Simplified VAT Return
| VAT Return Name | E-commerce VAT Periodic Tax Return |
| Filling frequency | Monthly |
| Online Filling | Mandatory |
| Annual Return | When requested Annual Information Return |
| Filing deadline | Until the end of the month following the tax period |
| Payment deadline | Until the end of the month following the tax period |
| Payment currency | IDR or USD |
| Language | English or Indonesian |
| Local VAT acronym | VAT |
Penalties for late reporting and omitted declarations
Penalties for VAT Non-Compliance:
Failure to register when required may result in penalties, including fines, interest charges on unpaid VAT, and other penalties.
E-Commerce VAT Collector who does not comply with the provisions in the Regulation of the Minister of Finance, along with its implementing regulations, in addition to being subject to administrative penalties in accordance with tax laws and regulations, is also subject to penalties in the form of termination of access after being previously formally notified about its wrongdoings.