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Indonesia imposes 10per cent VAT on Facebook, Disney, Tiktok - tax office

JAKARTA: Indonesia has added more techology companies that will be obligated to apply 10per cent value-added tax on sales to Indonesian customers to include Facebook, Disney and TikTok, the tax office said in a statement on Friday.

Southeast Asia's biggest country, which has a population of nearly 270 million people, announced last month it will impose 10per cent VAT on sales by technology firms including Amazon, Netflix, Spotify and Google, as spending patterns shift with increased remote working amid the pandemic, which has hit government finances.

The additional companies announced on Friday include three units of Facebook, Tiktok Pte Ltd, Apple Distribution International Ltd, The Walt Disney Company (Southeast Asia) Pte Ltd, and more of Amazon's subsidiaries, including its audiobook unit Audible and its voice assistant Alexa.

The companies did not not immediately respond to requests to comment.

Under Indonesia's rules, non-resident foreign firms which sell digital products and services in Indonesia worth at least 600 million rupiah (US$41,039.67) a year or which generate yearly traffic from at least 12,000 users will be required to pay the 10per cent VAT.

Indonesia expects to record a 13per cent annual drop in state revenue this year as the coronavirus pandemic disrupts business activity.

(US$1 = 14,620 rupiah)

(Reporting by Tabita Diela; Additional reporting by Fanny Potkin; Writing by Fransiska Nangoy; Editing by Ed Davies)

Source: Reuters

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