GSL / International Taxation / Indonesia


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Taxes of Indonesia

Сorporate tax
5 - 35% / 22%
Capital gains tax
20% (dividend), 20% (interest), 20% (royalty)
Withholding tax
Exchange control

Basic taxes (briefly)

Personal tax
Corporate tax (in detail)
The corporate tax rate is 0.5% until the turnover exceeds IDR 4 800 000 000 (~ USD 330 000). Thereafter, the standard corporate tax rate of 22% applies. Resident corporate taxpayers with gross revenue up to IDR 50 000 000 000 000 receive a 50% reduction in the corporate tax rate levied on taxable income for gross revenue up to IDR 4 800 000 000 (~ USD 330 000)
Capital gains tax. Details
Standard personal income tax and income tax rates apply to most capital gains
VAT. Details
The obligation to register for VAT arises once the turnover exceeds IDR 4 800 000 000 (~ USD 330 000)
Other taxes
Motor vehicle tax; vehicle title transfer fee; motor fuel tax; heavy equipment tax; surface water tax; cigarette tax; advertising tax; non-metallic and mining mineral tax; groundwater tax; tax on certain goods and services
Government fee
Stamp duty
Some documents are subject to a stamp duty of IDR 10 000

Income tax

A flat income tax rate of 22% is generally applicable to net taxable income.

However, special tax regimes apply to certain taxable entities or industries. For example, there are discounts for public and small companies (if certain conditions are met, the effective rate is reduced to 19% and 11%, respectively).

Personal income tax

The following tax rates apply to personal income in Indonesia:

  • up to IDR 60 000 000 - 5%;
  • from IDR 60 000 000 to ISD 250 000 000 - 15%;
  • from IDR 250 000 000 to IDR 500 000 000 - 25%;
  • from IDR 500 000 000 to IDR 5 000 000 000 - 30%;
  • over IDR 5 000 000 000 IDR - 35%.


The standard rate of VAT has been increased from 10% to 11% from 1 April 2022, with further increases to 12% planned from 1 January 2025.

In addition, a zero rate (0% rate) is also provided for.

Sales tax on luxury goods

In addition to VAT, certain goods (e.g. cars and luxury residences) when imported or supplied by a manufacturer to another party are subject to additional tax at rates that currently range from 10% to 95%.

Contributions to the Social Insurance Fund

Employers' insurance contributions are calculated as a percentage of normal salary ranging from 0,24% to 4%. This applies to all employees, including expatriates who have worked in Indonesia for more than 6 months.

Regional taxes

A corporate taxpayer may be required to pay certain regional taxes and levies. The rates of such taxes and levies range from 0,2% to 75%.

The following are examples of regional taxes that may apply:

  • motor vehicle tax;
  • vehicle title transfer fee;
  • motor fuels tax;
  • heavy equipment tax;
  • surface water tax;
  • cigarette tax;
  • advertising tax;
  • tax on non-metallic and mining minerals;
  • groundwater tax;
  • tax on certain goods and services.

CFC Rules

A controlled foreign company (CFC) is a foreign entity that is at least 50% owned by an Indonesian taxpayer or Indonesian taxpayers.

In Indonesia, certain income of a CFC is subject to the deemed dividend rules. This income includes dividends, interest, rents, royalties, and (subject to certain limitations) gains from the sale or transfer of assets.

Transfer pricing

Transactions between related parties must comply with the arm's length principle: this principle involves recalculating the value of contracts for transactions between related parties to market values for tax purposes. This means that if the market price level is not met, the Indonesian tax authority is authorised to recalculate the taxable income or deductible expenses arising from such transactions using the arm's length principle.

Capital gains tax

Most capital gains are subject to the standard rates of income tax (if we are individuals) and corporate income tax (if we are legal entities). Capital gains from shares listed on the Indonesian Stock Exchange are taxed at a rate of 0,1% of the transaction value. Gains derived from the disposal of land and/or buildings by companies are taxed at a rate of 2,5% of the sale proceeds (for individuals, the rate of this tax is 5%).

Withholding tax

A basic withholding tax rate of 20% applies to dividends, interest and royalties paid to a tax non-resident of Indonesia. The rate may be reduced under a double tax treaty.

International Tax Treaties

Indonesia has concluded 71 Double Tax Treaties (Double Tax Treaty / DTC) as well as 6 Tax Information Exchange Agreements (Tax Information Exchange Agreement / TIEA) with the following jurisdictions:

71 DTCs: Algeria, Armenia, Australia, Austria, Bangladesh, Belarus, Belgium, Brunei, Bulgaria, Cambodia, Canada, China, Croatia, Czech Republic, Denmark, Egypt, Finland, France, Germany, Hong Kong, Hungary, India, Iran, Italy, Japan, Jordan, Korea (North), Korea (South), Kuwait, Laos, Luxembourg. Malaysia, Mexico, Mongolia, Morocco, Netherlands, New Zealand, Norway, Pakistan, Papua New Guinea, Philippines, Poland, Portugal, Qatar, Romania, Russia, Serbia, Seychelles, Singapore, Slovakia, South Africa, Spain, Sri Lanka, Sudan, Suriname, Sweden, Switzerland, Syria, Taiwan, Tajikistan, Thailand, Tunisia, Turkey, Ukraine, United Arab Emirates, United Kingdom, United States of America, Uzbekistan, Venezuela, Vietnam, Zimbabwe.

6 TIEAs: Bahamas, Bermuda, Guernsey, Isle of Man, Jersey, San Marino.

In addition, Indonesia has signed and ratified the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting / MLI. The Multilateral Convention entered into force for Indonesia on 1 August 2020.

Currency control

Individuals entering or leaving Indonesia with cash and/or other forms of payment of at least IDR 100 000 000 (or equivalent) must notify the Indonesian General Directorate of Customs and Excise.

Indonesia does not prohibit the transfer of funds to or from foreign countries. However, for transfers from Indonesia of USD 100 000 or more (or equivalent), the person carrying out the transaction must provide appropriate documentation, which will be submitted to the Central Bank of Indonesia (Bank Indonesia) by the relevant bank.

All cash or non-cash transactions conducted in Indonesia by residents or non-residents must be conducted using IDR.

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