JAKARTA - Finance Minister Sri Mulyani Indrawati has signaled that the government will seek to tax digital platforms as part of its effort to cushion the impact of the coronavirus (Covid-19) pandemic.
According to Ms Indrawati, the Directorate General of Taxes will seek to tax digital platforms through an expansion of tax on electronic transactions as stipulated in Government Regulation in Lieu of Law No. 1/2020 on the State Financial Policy and Financial System Stability to Handle the Coronavirus Pandemic.
As examples, the former World Bank Managing Director mentioned video conference app Zoom and streaming service Netflix, which have been widely used by Indonesians during a period of physical distancing that forces them to stay and work from home.
“Zoom has no office in Indonesia, so we cannot tax them. But they have sizeable economic activities [in Indonesia],” said Ms Indrawati in a Financial System Stability Committee (KSSK) video conference as quoted by CNN Indonesia, Wednesday (1/4).
As previously reported by IDNFinancials.com, President Joko Widodo has approved a widening of budget deficit by up to 5.07% in the 2020 State Budget due to lower state revenues including oil and gas revenue, taxes, and non-tax state revenues. (MS)