Library of Congress

Law Library of Congress

The Library of Congress > Law Library > News & Events > Global Legal Monitor

Indonesia: Sales Tax Reduction for Luxury Goods

(July 6, 2015) On June 8, 2015, Indonesia’s Ministry of Finance issued a regulation that revises the types of goods subject to luxury tax, although motor vehicles are unaffected by the change. (Nina Umar, Indonesia: Removal of Sales Tax on Certain Luxury Goods, TAX NEWS SERVICE (June 29, 2015), International Bureau of Fiscal Documentation online subscription database; Peraturan Menteri Keuangan Nomor: 106/PMK.010/2015 Tentang Jenis Barang Kena Pajak yang Tergolong Mewah Selain Kendaraan Bermotor yang Dikenai Pajak Penjualan atas Barang Mewah [Ministry of Finance Regulation 106/PMK.010/2015 on the Types of Goods Categorized as Luxury Goods for the Tax on Sales of Luxury Goods, Aside from Motor Vehicles] (July 8, 2015), PB TAXAND (last visited June 29, 2015).)

Goods no longer subject to the luxury tax will, however, be subject to a 10% increase in the applicable import tax. (Umar, supra; Ministry of Finance Regulation 107/PMK.010/2015, PAJAK ONLINE (June 8, 2015) (in Indonesian).)

The goods included in the changes to the luxury tax are:

  • electronic appliances, such as air conditioners, refrigerators, washing machines, TVs, and cameras;
  • sports equipment, such as fishing equipment, golf equipment, and diving and surfing equipment;
  • musical instruments, such as the piano and electric musical instruments;
  • certain branded goods, such as clothing, perfumes, accessories, bags, watches, and metal goods; and
  • household and office furnishings, such as carpets, mattresses, furniture, porcelain, and crystal. (Umar, supra.)