Newest Import Duties in Indonesia: 2023 Update

A new governmental regulation stipulates that import duties in Indonesia have been effective since January 30, 2020. This regulation is the Finance Ministerial Regulation (PMK) No.199/2019, and it was enacted to reduce the maximum value for imported goods to be tax-free.

According to PMK 199/2019 issued by the Ministry of Finance, the maximum value of tax-free items for import into Indonesia will be decreased from US$75 to US$3 for each recipient and shipment.

Furthermore, all taxable goods for import into Indonesia have a 7.5% import duty and a 10% value-added tax. Before the implementation of PMK 199/2019, a 10% income tax applies to taxable goods and the value-added tax and import duty.

Therefore, thanks to these new regulations, importers must only pay 17.5% for taxable items for import into Indonesia – 9.5% fewer than the previous 27%.

Nonetheless, the regulation does not apply to certain products imported into Indonesia, such as shoes, bags, and garments. As a result, E-commerce businesses are now optimistic that this new policy will bring in more sales, improve local businesses, and decrease the country’s trade deficits.

Need Import Advice? Talk to Experts!

The Exception: Batam

PMK 199/2019 applies to all regions in Indonesia. However, Batam remains a controversial region due to its status as a free trade zone area, and all goods imported into Batam are not subject to import taxes and duties – unless the goods are further distributed to other Indonesian regions from Batam.

Therefore, to continue bringing more foreign exchange to Indonesia with the international trade traffic in Batam, PMK 199/2019 only applies to imported goods released from Batam to other Indonesian regions.

Free Trade Agreements and Import Tariffs

In addition to the above, import tariffs from countries with trade agreements with Indonesia will differ. The first is import tariffs between Australia, New Zealand, and ASEAN countries. The second one is between South Korea and ASEAN countries. The third one is between India and ASEAN countries. And the fourth one is between China and ASEAN countries.

For detailed import tariffs between the countries mentioned above, contact our dedicated team of consultants.

How to Start an E-commerce Business in Indonesia

The import into Indonesia jumped from 19.6 million items to 50 million in just a year between 2018 and 2019. Therefore, e-commerce is a potentially massive industry in Indonesia that is hard to overlook.

For investors to start an e-commerce business in Indonesia, here’s the summary of the requirements and obligations:

Requirements to Start an E-Commerce Business in Indonesia

• Obtain a business license via the Indonesian Online Single Submission System
• Obtain technical licenses and taxpayer numbers and comply with other business requirements
• Assist in governmental programs
• Give honest, complete, and valid information to the authorities—for instance, the electronic system, service conditions, guarantees, identities of legal subjects, etc.

Updated regulations on Setting Up an E-commerce Business in Indonesia

Obligations for Customer Protection

E-commerce businesses are obliged to comply with the following related to customer protections:

• Customer complaint procedure, including the follow-up mechanism
• Customer’s address and phone number
• Complaint handling from a competent person
• The time necessary for complaint settlement

How InCorp Indonesia Can Assist

You can import into Indonesia and set up an e-commerce business quickly if you have the proper guidance to help you with all the business registration and incorporation formalities.

At InCorp Indonesia (formerly Cekindo), we can guide you through the requirements and obligations of starting an e-commerce company and support you with consultations and paperwork until your business is up and running.

The expert team at InCorp Indonesia will handle all your business incorporation needs with professional guidance and expansive connections.

We understand many things are happening while setting up a company in Indonesia. Therefore you, as a business owner, are not in a position to deal with all these complicated rules and regulations that you must abide by.

But don’t worry – InCorp Indonesia has everything you need to start your business in Indonesia. Contact us by filling in the form below, and one of our business incorporation specialists will guide you through all the processes.