JAKARTA. The seriousness of the government to collect taxes from giants digital company like Google, Facebook, Twitter, Youtube, and Yahoo are still awaited. Because government has to provide legal certainty of digital companies, as well as ensure the state revenues from the digital business sector.
The giant digital companies have been getting a lot of the profits of Internet users in Indonesia, mainly from the advertising business. According to Indonesian Telecommunications Regulatory Agency (BRTI), the absence of Minister of Communication and Information regulation on the internet based content company or over the top (OTT) is one of the hurdles to collect taxes from digital companies
Currently, the ministerial circular is the only regulation concerning digital company. “Apparently, Minister of Communication and Information regulation is facing many challenges to release ministerial regulation,” said I Ketut Prihadi, members BRTI.
According to Prihadi, information has it that rejection comes mainly from some foreign embassies in Indonesia. One of them from Embassy of the United States of America (the US). In addition to foreign embassies, the rejection also came from companies that will be subject to the ministerial regulation. These companies assessed the policy plan is not realistic.
"They said that based on best practices in other countries, digital companies only need to pay value-added tax (VAT). But for us, VAT burden imposed to consumers, not to them”, he said.
Immediately discussed
Minister of Communications and Information Rudiantara explained that he did not meet challenges in issuing ministerial regulation concerning digital company. He said the formulation of the regulation is in ongoing process. Rudiantara added that previously he has had discussions with Minister of Finance Bambang Brodjonegoro, before he was being replaced. “I have not discussed yet about the regulation with the new minister”, he said.
Previously, at the end of August 2016, Ministry of Communication and Information stated to issue the ministerial regulation at the end of this year. One of the provisions of the regulation will be related to taxation procedures for OTT. Ministry of Communication and Information is now considering OTT as permanent establishment (BUT), said Acting Head of Public Relations Affairs of Ministry of Communication and Information Noor Iza.
Executive Director of Indonesian Telecommunications Association (ATSI) Sutrisman expected that the government has to immediately ascertain taxation for giant digital companies in order to provide equal treatments for all businessmen in digital sector.
Sutrisman added that recently, communication services provided by giant digital companies have caused incomes of telecommunications operators in the country shrunk. "Their presence has made voice and SMS services are not reliable”, he said. This has subsequently reduced state revenues. (Translator: Muhammad Farid)
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