Jakarta (WNAM MONITORING): Finance Minister Purbaya Yudhi Sadewa announced up to 0 percent tax incentives for businesses who comply with the government’s regulation for managing foreign exchange proceeds from natural resources exports (DHE SDA) in the domestic financial system.
Under the regulation, the government requires natural resource exporters to deposit 100 percent of their foreign exchange proceeds into the Indonesian financial system or repatriate them with a 100 percent compliance rate.
“The government provides tax incentives for exporters who comply with placing their DHE SDA domestically. This includes lower Income Tax (PPh) rates compared to regular (investment) instruments,” Purbaya stated in Jakarta on Sunday.
He said that the tax rates and incentives provided to each business will be adjusted based on the period of placement of the funds.
The incentive of a 0 percent income tax deduction on the placement of natural export proceeds is more beneficial for exporters than if they invested the funds in other regular investment instruments, which can be taxed up to 20 percent, according to him.
“Usually, if it is in bonds, the yield is taxed at 20 percent. If the source is DHE SDA, the tax on that instrument is 0 percent,” Purbaya said.
He further mentioned that exporters of oil and gas commodities are required to place a minimum of 30 percent of their export proceeds for a minimum of three months.
Meanwhile, exporters of non-oil and gas commodities are required to place 100 percent of their export proceeds in a special domestic account for a minimum of 12 months.
Export proceeds must be deposited through local banks listed at the State-Owned Banks Association (Himbara).
