Indonesia Tax News
Clarification on tax treaty benefits
Regulations for implementation of new Income Tax Act – Listed companies
Revised interpretation of "beneficial ownership" under tax treaties
Clarification – Application of tax treaties in calculating BPT for trading representative offices
Amendment to withholding tax rules for discounts of state debentures
Treaty between Morocco and Indonesia signed
"Business purpose" test for transfer of assets in business merger, consolidation or expansion
New Income Tax Bill – details
Revaluation of fixed assets for businesses
Treaty between Portugal and Indonesia enters into force
Corporate tax rate may be reduced to 25%
Treaty between Indonesia and Qatar ratified
New Taxation Arrangements and Procedures Bill passed
Ministry of Finance clarified which opinions issued by tax authorities are relevant for waiver of tax penalties
Tax exemption for discount on government bonds
New Investment Bill passed
Treaty between Indonesia and Netherlands – Indonesian Supreme Court Decision on treaty shopping
Tax incentives for investments in certain industries
Withholding tax on short-term government bond discounts introduced
Interpretation of "beneficial owner" under tax treaties
Two-year program to stimulate investment
The Indonesian Director General of Taxation on 1 June 2005 issued Circular Letter SE-17/PJ.2005 establishing under the 2002 Indonesia-Netherlands tax treaty on income a withholding tax of 10% on interest paid to Netherlands residents.
The Director-General of Taxation has issued circular letter SE-04/PJ.34/2005 dated 7 July 2005 in which guidance is given on how the term "beneficial owner" should be interpreted under tax treaties entered into by Indonesia. According to the circular letter, the beneficial owner is the actual owner of the income in the form of dividend, interest and royalty.
The first-time income tax treaty and protocol between Mexico and Indonesia, signed on 6 September 2002, entered into force on 28 October 2004. The treaty generally applies from 1 January 2005.
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