Effective 1 October 2026, the Indonesian Directorate General of Taxes (DJP) will implement the collection of Income Tax Article 22 (PPh Pasal 22) through marketplace platforms. This measure aims to capture tax revenue from the rapidly growing digital economy sector by designating marketplace operators as tax collectors for transactions conducted on their platforms. The regulation applies to both domestic and cross-border e-commerce transactions, requiring marketplaces to withhold and remit PPh Article 22 on behalf of sellers. This move aligns with the government’s broader strategy to ensure fair taxation of digital economic activities and improve tax compliance in the platform economy.
Key Takeaways
- New Withholding Obligation: Marketplace operators must register as tax collectors and implement systems to calculate, withhold, and report PPh Article 22 for every taxable transaction facilitated on their platforms.
- Scope and Compliance: The rule covers sales of goods and services by sellers (both individuals and entities) to buyers in Indonesia, including cross-border sales where the marketplace acts as an intermediary.
- Administrative Impact: Sellers should verify that marketplaces are correctly applying the withholding and obtain proper tax receipts (bukti potong) for credit against their annual tax liability.
Disclaimer: This article is compiled and summarized by the AI based on publicly available information and is for general information purposes only. It does not constitute any form of formal tax advice, legal opinion, or basis for performance. Please consult a qualified professional tax advisor or legal counsel for tax advice.
Source: Read Official Announcement