Fiskal Tax & NPWP

June 26th, 2008, in Business & Economy, by Patung

Rupiah The fiskal exit tax is to be abolished, for registered taxpayers, to encourage the payment of income tax.

From 1st January 2009 those with a tax-file number (NPWP, Nomor Pokok Wajib Pajak), and their dependents, will no longer be required to pay the 1 million rupiah fee upon leaving the country, called fiskal. From 1st January 2011 the “fiskal free” policy will be extended to all those travelling abroad, according to revisions to the Pajak Penghasilan (PPh) bill that have yet to be agreed upon by parliament.

Darmin Nasution
Darmin Nasution.

Darmin Nasution of the Tax Office, said to be a collector of interesting photos on the internet, says the two year delay in abolishing the fiscal tax entirely is to encourage people to get an NPWP, since most Indonesians do not have one and pay no income tax directly.

Darmin also says until now many people avoided paying fiskal because there were many categories of exemptions, and the planned changes were intended to simplify things.

The new policy of exemption for NPWP holders uses the concept of family/households, says Darmin, so that dependents of NPWP holders, such as children 21 and under, and wives, may use the head of the household’s tax file number to gain an exemption from paying fiskal. Those over the age of 21 can continue to use their father’s NPWP, provided they are still listed on his Family Card (kartu keluarga).

Darmin says there will be no loss of revenue for the state, except in the first year and quite the reverse in the medium term, because the shortfall from fiskal (in 2007 fiskal revenues were 2.5 trillion rupiah) will be made up in new income tax receipts. Currently there are around 6 million NPWP’s issued, and of these about 4.8 million are held in the name of individuals, as opposed to companies and organisations. [1]


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12 Comments on “Fiskal Tax & NPWP”

  1. timdog Says:
    June 26th, 2008 at 7:48 pm

    Good grief - it’s actually a good idea emenating from Indonesian government!
    What about foreigners resident in Indonesia? KITAS-holders already generate a fair dollop of income for the government thanks to the various costs and tax liabilities (usually met by their employers), so how about an exemption for them too?

  2. sputjam Says:
    June 26th, 2008 at 8:35 pm

    I thought brunei is a tax free haven. I was wrong.

  3. Abdul Khalid al Jumhuri Says:
    June 27th, 2008 at 3:15 am

    Good idea indeed! I hope that KITAS holders who have NPWP should be treated the same. This will incentivize all to declare income tax. The process to apply was not all that difficult, the same is the procedure to cancel when the Expats leave the country. I have done both procedures many times.

  4. Patung Says:
    June 27th, 2008 at 9:33 am

    I thought brunei is a tax free haven. I was wrong.

    Sputjam, are you just worried more Indonesians are going to come to Malaysia now? ;)

  5. Achmad Sudarsono Says:
    June 27th, 2008 at 9:39 am

    Interesting — so does that mean foreigners without an NPWP will get busted at the airport ? It’d be an easy way to do it…

  6. Farah Says:
    June 27th, 2008 at 11:36 am

    Well… its good, and hopely it will be true. To be honest i don’t really see where the fiskal money goes to (for tourism facility (street?)? or for airport?)
    But still went outside country from Batam or Pekan Baru would be my choice since years ago.. its FREE for me hehehehehe….

    Good idea once again.

  7. kinch Says:
    June 27th, 2008 at 11:50 am

    So that means I’ll be seeing you in SG this weekend, Farah? :D

  8. The Righteous Dude Says:
    June 27th, 2008 at 11:35 pm

    according to revisions to the Pajak Penghasilan (PPh) bill that have yet to be agreed upon by parliament.

    In other words, it either won’t happen or won’t happen for a long time.

    Did DN say how the fiskal inspectors will be redeployed? Maybe move them to the Customs Office?

  9. Farah Says:
    June 30th, 2008 at 4:49 pm

    @ Kinch
    Sorry kinch, i am busy counting my coconut production per day, you should made appointment at least a month before ….. and i can’t even count up to 100 in english !!

    unless if anyone with good english here help me !

  10. Rob Says:
    August 25th, 2008 at 4:17 am

    Righteous Dude…

    It will happen. The RUU has been the subject of recent debate at the House of Representatives. Although not all issues have been resolved in terms of the provisions of the bill, it seems that the fiskal provisions are not problematic.

    The current plan should see the bill pass by the end of 2008 and therefore the fiskal provision could conceivably be implemented beginning in 2009.

    The provisions would apply to foreigners who have a NPWP. Most foreigners who are here working legally have a NPWP. The practicalities of proving this might be as simple as flipping out the KITAS at the airport or as most foreigners with a KITAS already know it might be cross-checked at the time you apply for an Exit-Entry Permit. Albeit I am guessing there will be specific implementing regulations issued to govern the procedures.

    The other issue is that no-one really knows where this fiskal tax money goes. In many ways it is similar to the USD 100 a month legally working foreigners pay to the government.

    My guess is what you make up for on the merry-go-round you will lose on the swing. Perhaps the government will just jack up the foreigner tax from USD 100 per month to USD 150 per month. For foreigners like me who on a good year might leave the country once maybe twice per year the idea of dumping the fiskal tax might not make so much sense to me if such a scenario was to play out. Just a thought.

    Achmad…

    Interesting — so does that mean foreigners without an NPWP will get busted at the airport ? It’d be an easy way to do it…

    Busted how? Tourists will not have a need for an NPWP. Those working illegally here might not have a KITAS so going through the airport they would appear to be nothing more than a tourist. Those that are working here with illegally obtained documents will be much more difficult to uncover, albeit not impossible. However, I would imagine the airport to be the least likely place they are going to be uncovered.

  11. KZ Says:
    October 2nd, 2008 at 2:29 pm

    For Indonesian but live overseas, if taking up loan from the bank in Indonesia, does anyone know if NPWP is necessary? I would assume you only pay your income tax from the country where your income is from?

  12. AchmadSudarsono Says:
    October 2nd, 2008 at 3:47 pm

    Hi Rob,

    There might, though, be some foreigners without NPWPs. Some might be afraid of deaing with the tax department. They might be in the sh*t if they don’t get one — an NPWP, that is.

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