Income Tax Facilities

Newest tax facilities governed in Regulation of the Minister of Finance No. 144/PMK.011/2012, September 3, 2012, which replaced the Minister of Finance Regulation No. 16/PMK.03/2007. The provisions of the Minister of Finance Regulation No. 144/PMK.011/20012 came into force by 3 September 2012.

Tax facilities provided in the Minister of Finance Regulation mentioned above are as follows:

To resident corporate limited liability taxpayers and cooperatives, which perform at the Capital Investment:

  1. certain areas of business as set out in Appendix I of Government Regulation Number 1 Year 2007 on Income Tax Facilities for Investment in Certain Business Fields and / or in Certain Areas as last amended by Government Regulation Number  52 Year 2011, or
  2. certain business fields and certain areas as governed in Appendix II of Government Regulation Number 1 Year 2007 on Income Tax Facilities for Investment in Certain Business Fields and / or in Certain Areas as last amended by Government Regulation Number  52 Year 2011,

shall be granted Income Tax facilities.

Income Tax Facilities to be granted are as follows:

  1. reduction of net income of 30% of the investment amount, charged for 6 years respectively by 5% per year;
  2. accelerated depreciation and amortization;
  3. imposition of income tax on dividends paid to foreign tax subjects by 10%, or a lower rate under the Double Taxation Avoidance Agreement applies, and
  4. compensation losses for longer than 5 years but not more than 10 years.

Depreciation and amortization are as follows:

Group Tangible Fixed Assets

Useful Live

Depreciation Method


Straight Line

Declining Balance

I NotBuilding

2 year


100% (charge once)

  Group I

4 year



  Group II

8 year



  Group III

10 year



  Group IV  

II Building


10 year


  Not Permanent

5 year


While the provision for losses compensation longer more than 5 years, but not more than 10 years is as follows:

  1. Additional 1-year: if the new investment in certain business areas as governed in Appendix I of the Government Regulation Number 1 Year 2007 on Income Tax Facilities for Investment in Certain Business Fields and / or in Certain Areas as last amended by Government Regulation No. 52 Years 2011 executed in an industrial area and bonded area;
  2. Additional 1 year:  if employing at least 500 Indonesian workers for 5 consecutive years;
  3. Additional 1 year:  if new investment requires investment /expenditure on economic and social infrastructure at the business location of at least Rp 10,000,000,000,00;
  4. Additional 1 year:  if the cost of research and development in Indonesia in the context of product development or production efficiency of at least 5% of the investment within a period of 5 years, and / or
  5. Additional 1 year: If using raw materials and / or components of domestic production at least 70% since the 4th year.


Maters draw my attention from the Minister of Finance Regulation No. 44/PMK.011/20012  above, is that the tax facilities, not only granted to the taxpayer as a domestic limited liability company but also granted to a cooperative. So in my opinion there have been improvements in the Government espoused thinking patterns. Hopefully alignments Government to the people not only limited to this.

What do you think? I would be very happy to receive comments or opinions from you.

About Jaja Zakaria

Nama saya Jaja Zakaria, saya tinggal di Depok, Jawa Barat, kurang lebih 40 km dari Jakarta Selatan. Saya alumni Fakultas Hukum Universitas Gadjah Mada, Yogayakarta, dan Opleidings Instituut Financien, Den Haag, Belanda di bidang Hukum Pajak Internasional. Saya pengarang beberapa buku, e-book, dan makalah-makalah perpajakan. Pengalaman saya antara lain pernah menjadi anggota delegasi Indonesia dalam perundingan Perpajakan dengan Denmark, Mesir, Kanada, Uni Emirat Arab, Kuwait, Turki, Brunei Darussalam, Pilipina, Vietnam, Mongolia, dan Taiwan; dalam Study Group on Asian Tax Administration and Research (SGATAR) meeting; dan dalam Joint Commission Indonesia - China. Saya juga anggota International Word Tax Expert.

Posted on June 3, 2013, in English Version, Forum, New Tax Regulation, Uncategorized and tagged , , . Bookmark the permalink. 7 Comments.

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