Jakarta, Tuesday, April 12, 2016. Regarding the Government's plans to impose VAT free against some business models of e-commerce, which is also the founder PriceArea Board of Public Policy Area E-Commerce Association of Indonesia - Bima Laga, said the application of VAT free of charge to players e -commerce will provide a significant impact to the growth of the industry, which notabena still largely provides its services free of charge. Given the many foreign players who are still in operation for free in Indonesia, it will create the effect of injustice in the industry.

Value Added Tax (VAT) free of charge in question is intended for several business models like e-commerce and online classified ads marketplace that most of its services can be enjoyed by the user community for free. For users who mengiginkan more services can choose a paid premium service. The business model is often known as the freemium concept is often used as a mainstay for businesses in the digital realm, which is generally favorable to the user.

But it is suspected there was a misinterpretation of the government equate this free service with the distribution of free product samples, which legally must be taxed. This is certainly not unreasonable considering most of the services or content accessed via the internet is indeed free. Take, for example a news portal that can be accessed for free, music videos that can be enjoyed free of charge, to support productivity applications that are free.

"The Directorate General of Taxation should issue tax rules that could be applied by the respective business models of e-commerce. Along with the progress of the industry, the regulations also have to be able to adjust to the business itself. Take the example of Japan that has been more established in indsutri ecommerce, where pembentukanTeam special for taxation of all ecommerce transactions have started in the year 2002. at present ,. it's still too early for Indonesia to implement similar rules. "

"During this time PriceArea have to pay taxes in accordance with applicable law, ranging from VAT, Income Tax 21 23 Income Tax and Income Tax 25 in the future if the company is already profitable. We certainly support the Government's initiative as long as it is productive for the development of the industry." He said.
       
  
about IDEA
E-commerce Association of Indonesia which was formed in May 2012 an institution for the e-commerce industry players this country to interact with fellow players and also the government. Currently a member of the association includes more than 180 players from online retail category, market place, daily deals, classified ad, price comparison, travel, payment systems, logistics, and several related strategic partner. IDEA has a vision of making Indonesia as a state-based digital economy through a partnership with the partners in the country that can contribute to realizing the growth of e-commerce Indonesia, while continuing to hold a program of education and socialization about this industry.


For further information, please contact:


Ayu Indirawanty
Secretary General Idea
+62 21 2550 2625
ayu@idea.or.id