VAT on Digital Goods and Services Regulation Revised, Monthly Reporting Now Mandatory
The Directorate General of Taxes (DGT) has revised the provisions concerning Value Added Tax (VAT) on intangible goods and taxable services from abroad in the context of Trade Through Electronic Transactions (PMSE).
In general, PMSE VAT refers to the tax on purchases of digital products or services through digital platforms, which is collected by foreign digital businesses appointed by the DGT.
The revision, as outlined in the Director General of Taxes Regulation (PER) Number PER-12/PJ/2025, includes changes in terminology, rate adjustments, appointment and revocation mechanisms, data updates, and an accelerated reporting period.
This regulation took effect on May 22, 2025, and revokes PER-12/PJ/2020.
Terminology Change for PMSE VAT Collectors
Under the new regulation, the term “PMSE VAT Collector” has been revised to “Other Party”, referring to any entity that is involved in or facilitates transactions between transacting parties.
The criteria for entities eligible to be appointed as an “Other Party” remain the same, namely:
- Having transactions with Indonesian consumers exceeding IDR 600 million annually or IDR 50 million monthly, or
- Having more than 12,000 visitors from Indonesia per year or 1,000 visitors per month.
The appointment is carried out by the DGT, either ex officio or based on notification from PMSE business actors.
READ: Tax on Digital Economy Businesses Reaches IDR 33.39 Trillion
Revocation of the Appointment of PMSE VAT Collector
The Directorate General of Taxes (DGT) has established two revocation mechanisms:
First, ex officio, if the business entity no longer meets the required criteria.
Second, based on a request from the business entity (self-assessment), this is a new feature in the regulation that allows businesses to notify DGT when they no longer fulfill the qualifications. This notification can be submitted through the Tax Office (KPP), the taxpayer portal, or other platforms integrated with DGT's system.
The effective date of the revocation has also been adjusted. Previously, it took effect starting the month following the issuance date of the revocation letter. This takes effect as of the date stated in the decision letter.
Correction of PMSE VAT Collector Data
Under the new provisions, data corrections may be initiated either based on notifications from third parties or ex officio by DGT. DGT has also set a maximum deadline of 10 days to issue the correction decision from the date the request is received.
Adjustment of PMSE VAT Rate
The VAT rate collected is now aligned with the new VAT rate, which is 12% × 11⁄12 of the value (referring to Regulation of the Minister of Finance No. 131 of 2024), replacing the previous flat rate of 11%.
Use of Currency
VAT payments by foreign parties can now only be made in Indonesian Rupiah or United States Dollars (USD). Previously, payments could be made in various currencies.
USD payments must be made through a collecting agent appointed to receive tax payments in that currency.
Faster Reporting Period
One significant change is the acceleration of the reporting period. Previously, PMSE VAT reporting was done quarterly, but it is now mandatory on a monthly basis.
The report must be submitted in the form of a VAT Periodic Tax Return (SPT Masa PPN) electronically through the taxpayer portal or other platforms integrated with DGT’s system, no later than the end of the month following the end of the tax period.
Summary
Below is a comparison between PER-12/PJ/2020 and PER-12/PJ/2025:
| Aspect | PER-12/PJ/2020 | PER-12/PJ/2025 |
|---|---|---|
| Term for Collector | Referred to as “PMSE VAT Collector” | Changed to “Other Party” |
| Appointment Criteria | Transactions > IDR 600 million/year or traffic > 12,000/year | Same (unchanged) | |
| Appointment | By DGT, either ex officio or upon request of the business entity | Same, adjusted to the new administrative system (Coretax) |
| Revocation of Appointment | Only by DGT (ex officio) | By DGT or upon request (self-assessment) |
| Effective Date of Revocation | From the beginning of the month after the revocation letter | From the date of the revocation decision |
| Data Correction | Only upon request by the VAT Collector | By request or ex officio by DGT |
| VAT Rate | 11% of the tax base | 11% × 11⁄12 of the payment amount (in accordance with PMK 131/2024 | |
| Payment Currency | Rupiah, USD, or other currencies | Only Rupiah and USD |
| VAT Return Filing Period | Quarterly | Monthly |
| Filing Format & Method | Via the DGT system | Electronically via the taxpayer portal or DGT-integrated platforms |
| Refund/Compensation of Overpaid Tax | General (compensation or refund allowed ) | Foreign Other Parties: compensation only; Domestic: refund only (if not PKP) | |
| Transitional Provisions | Not Regulated | Applies to reporting & revocation for Jan–May 2025 |
DGT Regulation Number PER-12/PJ/2025 introduces several important updates to the administration of PMSE VAT, ranging from terminology changes and appointment/revocation mechanisms to rate adjustments and the acceleration of monthly reporting. This move reflects DGT’s effort to enhance supervision, improve compliance, and align the tax administration system with the rapidly evolving global digital economy. (ASP/KEN)
