E-Commerce Industry Players Question What Taxes The Government Wants To Charge

The government's plan to impose tax obligations on e-commerce players is apparently not kidding. The government is currently finalizing the plan by communicating with various related parties. Rudiantara, Minister of Communication and Information Technology, said that his party had discussed with the Ministry of Finance regarding the regulation plan. In fact, according to him, not only e-commerce, but also over the top (OTT) players who have transactions will also be taxed.

The tax liability regulations have actually been discussed for several years. However, for some it seems that the continuation of the plan is still rolling until now.

The chairman of the Indonesian E-commerce Association (idEA) Daniel Tumiwa questioned the government to whom and how the tax was imposed.

"Because as far as I know, so far e-commerce players have paid taxes, such as VAT," he said.

Because it is still considered gray, Daniel is also reluctant to comment on the impact of the tax regulation on the current e-commerce industry, both from service providers, sellers, and transactions made by consumers.

"It should be clarified first who is taxed, the owner of the site, the seller, or something. Likewise with the method, the rules are not clear," added Daniel, who is now Garuda Indonesia's Vice President of Digital Business.

Based on the regulations of the Directorate General of Taxes, through the Attachment of Circular Letter Number SE-62/PJ/2013 concerning Confirmation of Tax Provisions on E-commerce, there are four e-commerce business models that will be subject to taxpayers, including a business model with the concept of marketplace or sites that provide Internet services for sellers who want to trade online, classified ads or advertisers based on text, video, or images, daily deal or buying and selling voucher sites, and online retailers.

From the player's perspective, Elevenia, an e-commerce joint venture between XL Axiata and SK Planet, thinks that the company has paid taxes in accordance with applicable regulations. According to Elevenia's Chief Financial Officer Lila Nirmandari, the government must provide clarity regarding the regulation.

"If the purpose of imposing this tax is on top From the existing regulations, we need to understand the reason first. Because basically e-commerce business in Indonesia is still at the investment stage and not yet monetized," he said.

The e-commerce industry in Indonesia is indeed in its infancy in recent years. Although e-commerce penetration is still low due to limited internet access and devices, there are still many aggressive players entering this business. Several local startups in Indonesia that do e-commerce business have even received large injections of funds from foreign investors. For example, Tokopedia, which gets injection of funds of Rp 1,2 trillion from SoftBank Internet and Media, Inc (SIMI) and Sequoia Capital in October 2014.

Menurut research by the Indonesian E-commerce Association (idEA) with Google Indonesia and TNS (Taylor Nelson Sofres), the e-commerce market in Indonesia is estimated to triple to US$ 25 billion or equivalent to Rp 295 trillion in 2016.

Di marketplace Elevenia, said Lila, Sellers who fall into the category of Taxable Companies (PKP) are sure to pay taxes. Therefore, the government should issue regulations that are more supportive of e-commerce if the business wants to grow in Indonesia.