COVID-19 Pandemic: Introduction to Taxation Facilities for Indonesian Vaccines Importers

In order to accelerate the procurement of the COVID-19 vaccine, Indonesia’s government provides some customs and/or excise and taxation facilities for the import of vaccines, its raw materials, and necessary supporting equipment for the handling of COVID-19 pandemic in Indonesia.

Legal Frameworks: Our below executive summary refers to MoF Regulation No. 188/PMK.04/2020 of 2020 on Provision of Customs and/or Excise Facilities and Taxation Facilities for the Import of Vaccine Procurements for the Handling of the COVID-19 Pandemic (“MoF Regulation”)

Main Keys on the Customs, Excise, and Taxation Facilities for the Imports of Vaccines to Indonesia: We have managed to provide you the following main keys regarding customs, excise, and taxation facilities for the import of vaccines to Indonesia.

Customs, Excise, and Taxation Facilities provided by the Government: We note that Indonesia’s government provides the following facilities for the imports of COVID-19 vaccines:

  1. Exemptions to import duties and/or excise
  2. Non-imposition of Value Added Tax/Pajak Pertambahan Nilai (“PPN”) and Luxurious Goods Tax Sale/Pajak Penjualan atas Barang Mewah (“PPnBM”); and
  3. Exempted from the Art. 22 Import Tax/Pajak Penghasilan Pasal 22 Impor (Art. 2 (1) of MoF Regulation).

(collectively referred to as “Facilities”)

Vaccine Import Location: We note that the vaccine import Facilities must be completed in the following locations:

  1. Bonded logistic centers (Art. 2 (2) of MoF Regulation);
  2. Bonded areas/warehouses;
  3. Free areas or special economic areas; and/or
  4. Companies that have received export-oriented import facilities (Art. 2 (3) of MoF Regulation).

We further note that upon the release of vaccines, any businesses entities located in the areas aforementioned in point (2) to (4) above will be exempted from the following obligations:

  1. To pay for import duty and/or excise and non-collection of Taxes in Relation to the Import Framework/Pajak Dalam Rangka Impor (“PDRI”); and/or
  2. To pay for PPN and/or PPnBM (Art. 2 (4) of MoF Regulation).

Procedures of Facilities Application: We note that any vaccines importers must undertake the following procedures:

(1) Submission of facilities application to the Minister of Finance through the Head of Customs and Excise Office (the “Head”) of which the goods are entered/released through the Indonesia National Single Window System (Art. 3 (1) and (5) of MoF Regulation).

Note: Required documents that should be attached along with the application are as follows: (a) details of quantities and types of goods with the estimated customs value; (b) License from a related technical agency (if the imported goods are prohibited or restricted); (c) Business Identification Number/Nomor Induk Berusaha (NIB) or Taxpayer Registration Number/Nomor Pokok Wajib Pajak (NPWP) (“Documents”) (Please refer to Art. 3 (3) of MoF Regulation).

(2) The Head will investigate the submitted application and Documents (Art. 4 (1) of MoF Regulation).

(3) The Head will issue a Minister Decree for the granting or rejection of Facilities for import/release of vaccines within 3 (three) days upon the submission (Art. 4 (4) of MoF Regulation).

Rush Handling of Vaccine Imports: In order to implement rush handling, the applicants will be required to (Art. 6 (1), (2), (3) of MoF Regulation):

  1. Submit a rush handling request along with the relevant customs completion documents;
  2. Deposit collateral with the Head amounting to the relevant payable import duties and/or excise, PPN and Art. 22 Import Tax;
  3. Comply with import licensing provisions, as set by relevant related technical agencies.

With respect to the above, the Customs and Excise Official will commence an administration examination of the submitted applications. Such official will further issue either an approval for or a rejection of the release of the relevant imported goods (Art. 6 (7) of MoF Regulation).

The article above was prepared by Marshall S. Situmorang (Partner) and Aniendita Rahmawati (Associate). 

Disclaimer: The information herein is of general nature and should not be treated as legal advice, nor shall it be relied upon by any party for any circumstance. Specific legal advice should be sought by interested parties to address their particular circumstances. For more information, please contact us at mail@nusantaralegal.com.