a.

that certain goods and services tax on electricity constitute one of the important regional revenues to finance the administration of regional governments;

b.

that as a follow-up to the Constitutional Court of the Republic of Indonesia Decision Number 80/PUU-XV/2017 and pursuant to Law Number 1 of 2022 concerning Financial Relations between the Central Government and Regional Governments, it is necessary to stipulate provisions on the imposition of certain goods and services tax for both self-generated electricity or generated from other sources;

c.

that based on the considerations referred to in letter a and letter b, it is necessary to enact a Government Regulation concerning the Imposition of PBJT on Electricity;

 

 

 

 

 

1.

Article 5 paragraph (2) of the 1945 Constitution of the Republic of Indonesia;

2.

Law Number 1 of 2022 concerning Financial Relations between the Central Government and Regional Governments (State Gazette of the Republic of Indonesia of 2022 Number 4, Supplement to the State Gazette of the Republic of Indonesia Number 6757);

 

 

 

 

 

GOVERNMENT REGULATION CONCERNING THE IMPOSITION OF CERTAIN GOODS AND SERVICES TAX ON ELECTRICITY.

 

 

 

 

 

CHAPTER I
GENERAL PROVISIONS
 

Referred to herein this Government Regulation:

1.

Central Government, hereinafter referred to as the Government, is the President of the Republic of Indonesia who holds the power of government of the Republic of Indonesia assisted by the Vice President and ministers referred to in the 1945 Constitution of the Republic of Indonesia.

2.

Regional Government is the head of the region as an element organizing the Local Administration leading the administration of governmental affairs under the authority of autonomous regions.

3.

Autonomous Region, hereinafter referred to as Region, is a legal community unit having borders authorised to regulate and manage governmental affairs and the interests of the local community according to their own initiatives based on the people’s aspirations within the Unitary State of the Republic of Indonesia’s system.

4.

Local Regulation, hereinafter referred to as Perda or also referred to by other names, are Provincial Regulations and Regency/Municipal Regulations.

5.

Local Taxes, hereinafter referred to as Taxes, are compulsory contributions to the Regions payable for individuals or entities that are coercive under the Law, without receiving direct compensation and are used for the purposes of the Regions for the greatest prosperity of the people.

6.

Taxpayer is any individual or entity, comprising a taxpayer, a withholding agent and a collecting agent having tax rights and obligations pursuant to statutory tax provisions.

7.

Entity is a group of people and/or capital that constitutes a unit that either conducts business or not, including limited liability companies, limited partnerships, other companies, state or local-owned enterprises in whatever name and form, firms, joint ventures, cooperatives, pension funds, partnership, alliances, foundations, mass organisations, social and political organisations or any similar organisations, institutions and other forms of entities, including collective investment contracts and permanent establishments.

8.

Electricity is power or energy generated by a power station which is distributed for various electrical equipment.

9.

Certain Goods and Services Tax on Electricity, hereinafter abbreviated to PBJT on Electricity, are Taxes paid by end consumers on the consumption of Electricity.

10.

Taxable Period is a period used as the basis for a Taxpayer to calculate, remit and file Taxes payable in a certain period.

11.

Tax Year is a period of 1 (one) calendar year unless a Taxpayer adopts an accounting year that is different from the calendar year.

 

 

 

 

 

CHAPTER II
THE REGULATION OF CERTAIN GOODS AND SERVICES TAX ON ELECTRICITY

Section One
Regulatory Materials of PBJT on Electricity
 

(1)

PBJT on Electricity is stipulated under Perdas.

(2)

Perdas referred to in paragraph (1) at least stipulate the provisions on:

 

a.

types, objects, subjects and Taxpayers;

 

b.

Tax base;

 

c.

Tax rates;

 

d.

when Taxes become payable; and

 

e.

Tax collection areas.

 

 

 

 

 

Section Two
Objects, Subjects and Taxpayers
 

(1)

The object of PBJT on Electricity is the consumption of Electricity.

(2)

Consumption of Electricity referred to in paragraph (1) is the use of Electricity by end users.

(3)

Excluded from the consumption of Electricity referred to in paragraph (2), are:

 

a.

the consumption of Electricity by government agencies, Regional Government and other state administrators;

 

b.

the consumption of Electricity in places used by embassies, consulates and foreign representatives based on the principle of reciprocity;

 

c.

the consumption of Electricity in houses of worship, nursing homes, orphanages and other similar social institutions;

 

d.

the consumption of self-generated Electricity with a certain capacity that does not require a permit from the relevant technical agency; And

 

e.

other consumption of Electricity regulated by Perdas.

 

 

 

 

 

(1)

Subjects of PBJT on Electricity are Electricity consumers.

(2)

PBJT on Electricity Payers are individuals or Entities that sell, supply and/or consume Electricity.

 

 

 

 

 

Section Three
Tax Base
 

(1)

The tax base of PBJT on Electricity is the amount paid by consumers for the selling value of Electricity.

(2)

In the event that there is no payment as referred to in paragraph (1), the tax base of PBJT on Electricity is calculated based on the selling price of Electricity applicable in the area of the Region concerned.

 

 

 

 

 

(1)

The selling value of Electricity referred to in Article 5 paragraph (1) is stipulated for:

 

a.

Electricity originating from other sources with payments; and

 

b.

self-generated Electricity.

(2)

The selling value of Electricity stipulated for Electricity originating from other sources with payments referred to in paragraph (1) subparagraph a, is calculated based on:

 

a.

the amount of the bill/fixed costs plus the kWh/variable usage costs billed in the electricity account, for post-payments; and

 

b.

the amount of Electricity purchased for pre-payments.

(3)

The selling value of Electricity stipulated for self-generated Electricity referred to in paragraph (1) subparagraph b, is calculated based on the available capacity, the level of electricity usage, the period of electricity usage and the electricity unit price applicable in the Region concerned.

(4)

Based on the selling value of Electricity stipulated for Electricity originating from other sources with payments referred to in paragraph (1) subparagraph a and the selling value of Electricity referred to in Article 5 paragraph (2), the providers of Electricity as Taxpayers calculate and collect PBJT on Electricity for the use of sold or supplied Electricity.

 

 

 

 

 

Section Four
Rates
 

(1)

PBJT on Electricity rate is set at a maximum of 10% (ten percent).

(2)

Specifically, PBJT on Electricity rate for:

 

a.

the consumption of Electricity from other sources by industries, oil and natural gas mining, is set at a maximum of 3% (three percent); and

 

b.

the consumption of self-generated Electricity, is set at a maximum of 1.5% (one point five percent).

 

 

 

 

 

Section Five
When Taxes Become Payable
 

PBJT on Electricity become payable upon consumption/payment of Electricity.

 

 

 

 

 

(1)

PBJT on Electricity referred to in Article 8 become payable when an individual or Entity has fulfilled the subjective requirements and objective requirements of PBJT on Electricity within 1 (one) certain period in a Taxable Period, a Tax Year or a fraction of a Year Tax pursuant to statutory provisions on local Taxes and user charges.

(2)

The Taxable Period referred to in paragraph (1) is set for a period of 1 (one) calendar month or another period of a maximum of 3 (three) calendar months, which constitutes the basis for the Taxpayers to calculate, remit and file PBJT on Electricity payable.

(3)

The Taxable Period and Tax Year referred to in paragraph (1) and paragraph (2) are stipulated by a Regional Head Regulation.

 

 

 

 

 

Section Six
Collection Areas
 

PBJT on Electricity payable is collected in the areas where Electricity is consumed.

 

 

 

 

 

Section Seven
Use of Revenues for Specified Activities
 

(1)

PBJT on Electricity revenues of a minimum of 10% (ten percent) must be allocated for the provision of public street lighting.

(2)

The provision of public street lighting referred to in paragraph (1) includes the provision and maintenance of public street lighting infrastructure as well as the payment of costs for the consumption of Electricity for public street lighting.

(3)

In the event that the Regional Governments do not carry out the obligations referred to in paragraph (1), they shall be subject to penalties pursuant to statutory provisions.

 

 

 

 

 

To harmonise fiscal policies and monitor the fulfilment of the allocation referred to in Article 11, the Government prepares a standard chart of accounts and/or performs tagging of expenditures funded from PBJT on Electricity revenues.

 

 

 

 

 

Section Eight
Provisions on Tax Collection
 

(1)

PBJT on Electricity is collected based on self-calculation by the Taxpayer.

(2)

Provisions on procedures for the collection of PBJT on Electricity referred to in paragraph (1) comply with the provisions on the collection of Taxes under statutory provisions on general provisions and procedures for the collection of Taxes.

 

 

 

 

 

Section Nine
Procedures for the Payment of PBJT on Electricity Paid by the Government
 

(1)

The government pays PBJT on electricity for Electricity consumed by certain Taxpayers.

(2)

Certain Taxpayers referred to in paragraph (1) are Taxpayers that have signed an agreement with the Government in the upstream oil and gas business sectors or in other business sectors, whose Tax payable is waived and borne by the Government.

(3)

Payment of PBJT on Electricity by the Government referred to in paragraph (1) is sourced from a certain amount constituting part of state revenues for every business conducted by the Taxpayers.

(4)

PBJT on Electricity referred to in paragraph (1) are paid by the minister who administers governmental affairs in the field of state finances.

(5)

Further provisions on the procedures for the payment of PBJT on Electricity referred to in paragraph (1) are stipulated by a regulation of the minister who administers governmental affairs in the field of state finances.

 

 

 

 

 

CHAPTER III
CLOSING PROVISIONS
 

The Regional Governments adjust the Perdas concerning the collection of street lighting tax pursuant to this Government Regulation through the formulation of Perdas concerning local Taxes and user charges no later than 5 January 2024.

 

 

 

 

 

This Government Regulation shall come into force on the date of promulgation.

 

 

 

 

 

For public cognisance, this Government Regulation shall be promulgated by placement in the State Gazette of the Republic of Indonesia.

 

 

 

 

 

Enacted in Jakarta
on 20 January 2023
PRESIDENT OF THE REPUBLIC OF INDONESIA,
signed.
JOKO WIDODO

Promulgated in Jakarta
on 20 January 2023
MINISTER OF THE STATE SECRETARIAT OF THE REPUBLIC OF INDONESIA,
signed.
PRATIKNO

STATE GAZETTE OF THE REPUBLIC OF INDONESIA OF 2023 NUMBER 17

 

 

 

 

 

 

 

With the promulgation of Law Number 1 of 2022 concerning Financial Relations between the Central Government and Regional Governments, the Government has redesigned local Taxes and user charges policies. The policy redesign has been carried out, among others, by restructuring the types of Taxes through the reclassification of 5 (five) types of consumption-based Taxes into 1 (one) type of Tax, namely Certain Goods and Services Tax.

 

One of the objects of Certain Goods and Services Tax is the consumption of Electricity which was formerly regulated under Law Number 28 of 2009 concerning Local Taxes and User Charges with the nomenclature of Street Lighting Tax. The changes in nomenclature, in addition to reclassifying the types of Taxes, also aim to implement the Constitutional Court of the Republic of Indonesia Decision Number 80/PUU-XV/2017 in the case of the Judicial Review of Law Number 28 of 2009 concerning Local Taxes and User Charges against the 1945 Constitution of the Republic of Indonesia.

The Constitutional Court of the Republic of Indonesia Decision Number 80/PUUXV/2017 which was pronounced on 13 December 2018 stipulates that the articles regulating Street Lighting Tax referred to in Article 1 number 28, Article 52 paragraph (1), Article 55 paragraph (2) and paragraph (3) of Law Number 28 of 2009 concerning Local Taxes and User Charges are declared to contradict the 1945 Constitution of the Republic of Indonesia. However, the aforementioned articles are also stated to remain valid for 3 (three) years since the Constitutional Court of the Republic of Indonesia Decision was pronounced and the legislators of Law Number 28 of 2009 concerning Local Taxes and User Charges are instructed to amend the law, specifically, in respect of the regulation of Street Lighting Tax. Furthermore, in its consideration, the Constitutional Court of the Republic of Indonesia states that the use of Electricity, both self-generated and generated by other sources, may continue to be subject to Taxes, but with a more appropriate nomenclature regulation so as not to cause confusion for Tax subjects and Taxpayers.

Law Number 1 of 2022 concerning Financial Relations between the Central Government and Regional Governments which was promulgated on 5 January 2022, under Article 187 letter b regulates the transitional provisions that Perdas concerning local Taxes and user charges formulated pursuant to Law Number 28 of 2009 concerning Local Taxes and User Charges remain valid for a maximum of 2 (two) years from the date of promulgation of Law Number 1 of 2022 concerning Financial Relations between the Central Government and Regional Governments.

 

 

 

 

 

 

Article 1

Sufficiently clear.

Article 2

Sufficiently clear.

Article 3

Sufficiently clear.

Article 4

Sufficiently clear.

Article 5

Sufficiently clear.

Article 6

Sufficiently clear.

Article 7

Sufficiently clear.

Article 8

Sufficiently clear.

Article 9

Paragraph (1)

“Subjective requirements” refer to requirements pursuant to the provisions on Tax subjects under Law Number 1 of 2022 concerning Financial Relations between the Central Government and Regional Governments.

 

“Objective requirements” refer to requirements pursuant to the provisions on Taxable objects under Law Number 1 of 2022 concerning Financial Relations between the Central Government and Regional Governments.

Paragraph (2)

Sufficiently clear.

Paragraph (3)

Sufficiently clear.

Article 10

Sufficiently clear.

Article 11

Paragraph (1)

Sufficiently clear.

Paragraph (2)

The provision and maintenance of public street lighting infrastructure include payment for the availability of services for the provision and maintenance of public street lighting infrastructure provided through a cooperative financing scheme between the government and business entities.

Paragraph (3)

Sufficiently clear.

Article 12

Sufficiently clear.

Article 13

Paragraph (1)

Sufficiently clear.

Paragraph (2)

Provisions on the collection of Taxes include procedures for the payment, filing, assessments, collection, write-off of receivables, objections, appeals, bookkeeping and self-paid Tax audits based on the calculation by the Taxpayers.

Article 14

Sufficiently clear.

Article 15

Sufficiently clear.

Article 16

Sufficiently clear.

 

 

 

 

 

SUPPLEMENT TO THE STATE GAZETTE OF THE REPUBLIC OF INDONESIA NUMBER 6848