Taxation ยท KBLI 49420

Shipping Tax

Indonesian shipping companies operate under a distinctive final tax regime that differs significantly from standard corporate taxation. Domestic shipping lines are subject to PPh Article 15 final tax at 1.2% of gross revenue, while international shipping faces a 2.64% final rate โ€” rates that replace regular corporate income tax entirely for qualifying operators. Beyond income tax, shipping companies must manage VAT on freight services (11% domestic, 0% export/import), customs duties on vessel imports, crew income tax across jurisdictions, and potential tax holiday incentives for new vessel investments under the national shipping development program. The interaction between final tax regimes, VAT on international freight, and import duty exemption facilities creates a specialized compliance environment that requires deep maritime industry knowledge. Arunika Consulting delivers tailored tax solutions for shipping companies navigating Indonesia's maritime tax landscape.

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What usually goes wrong

  • Domestic vs International Route Classification

    Domestic shipping is subject to 1.2% final tax, while international shipping faces 2.64% โ€” misclassification of mixed routes can lead to significant underpayment or overpayment.

  • International Freight VAT

    Export freight is 0% VAT, import freight is subject to 11% VAT as the consignee's input tax โ€” tracking VAT treatment across different shipping legs adds administrative complexity.

  • Tax Holiday Qualification

    New vessel investments may qualify for 5-20 year tax holidays, but requirements around Indonesian flag registration, minimum tonnage, and pioneer route status are stringent and require careful documentation.

  • Crew Income Tax Across Jurisdictions

    Ship crews working international routes face multi-jurisdiction tax obligations, requiring proper tax equalization policies and treaty application for foreign crew members.

  • Vessel Import Taxation

    Importing vessels and spare parts involves customs duties, VAT, and PPh 22 import tax โ€” while exemptions are available through Masterlist applications, the process is complex and time-sensitive.

What we do

  1. 01

    PPh 15 Final Tax Compliance

    Management of 1.2% final tax for domestic shipping and 2.64% for international routes with complete supporting documentation, voyage records, and correct revenue allocation.

    • Accurate final tax
    • Timely reporting
    • Audit-ready records
  2. 02

    VAT Shipping Management

    Correct tax invoice issuance for domestic freight (11%), exports (0%), and related shipping services, with proper reconciliation of input VAT across ports and routes.

    • Correct invoice codes
    • Optimal VAT credit
    • Seamless compliance
  3. 03

    Vessel Investment Tax Planning

    Strategic advisory for tax holiday and tax allowance applications on new Indonesian-flagged vessel investments, including pioneer route qualification assessment.

    • Maximum tax holiday
    • Zero import duty
    • Investment efficiency
  4. 04

    International Crew Tax Management

    Comprehensive PPh 21/26 management for Indonesian and expatriate crew with tax equalization policies, treaty application, and proper reporting for multi-jurisdiction voyages.

    • Crew tax compliance
    • Treaty benefits applied
    • Expat tax handled

Related regulations

  • PMK-141/2015

    Shipping Income Tax

    1.2% final income tax for domestic shipping

  • PMK-34/2017

    Vessel Import Tax

    Income tax on vessel and spare part imports

  • PP 46/2019

    Shipping Tax Allowance

    Tax allowance for national shipping fleet investment

If the tax office starts asking questions

The team that keeps your books and files your taxes also stays with you through an SP2DK, an audit, an objection and an appeal.

How we handle tax disputes

Frequently Asked Questions

What is the final tax rate for Indonesian shipping companies?

Under PPh Article 15, domestic shipping lines pay a final tax of 1.2% of gross revenue, while international shipping companies pay 2.64%. This final tax replaces the standard 22% corporate income tax, providing significant simplification. Requirements include a valid SIUPAL license and Indonesian-flagged vessels. Foreign shipping companies with a permanent establishment in Indonesia are also subject to the 2.64% final rate.

Can new vessel investments qualify for tax holidays?

Yes. The shipping industry qualifies as a pioneer sector under PMK-130/2020 for tax holiday incentives. Investments of at least IDR 500 billion may receive 50% tax reduction for 5 years, while investments above IDR 1 trillion may qualify for 100% tax holiday for 10-20 years. Requirements include Indonesian-flagged vessels, national company operation, and minimum tonnage thresholds.

How is VAT applied to international shipping freight?

Export freight services are subject to 0% VAT, meaning no output VAT is collected but input VAT on related expenses remains creditable. Import freight is subject to 11% VAT collected at the border, which the consignee can claim as input tax credit. Shipping companies must carefully document whether each freight contract covers domestic, export, or import legs to apply the correct VAT treatment.

What tax incentives are available for vessel imports?

Vessel imports by Indonesian shipping companies may qualify for import duty exemption (0%), VAT not collected, and PPh 22 import tax exemption through the Masterlist facility administered by BKPM and the Ministry of Transportation. The vessel must be used for commercial shipping, be Indonesian-flagged, and not be transferred within a specified period. The Masterlist application requires detailed technical and commercial documentation.

Do foreign shipping companies need to register for Indonesian tax?

Yes, foreign shipping companies operating routes to or within Indonesia are generally considered to have a permanent establishment (BUT) and must register for an NPWP. They are subject to PPh Article 15 final tax at 2.64% on gross revenue from Indonesian-source shipping income. Many tax treaties may reduce or eliminate this rate โ€” treaty benefits should be verified before filing.

Who handles my tax work?

Your tax work is handled by Arunika's tax consultants. We confirm the scope, deadlines and price before work starts.

What should I do if I receive an SP2DK letter or tax audit notice?

Contact us early. We help analyze the risk, prepare supporting documents, draft the response, and assist discussions with the tax office.

What does tax planning cover?

We review your structure, transactions and available incentives so tax is calculated under the rules, without crossing into tax evasion. The outcome depends on your facts, so we do not promise a savings figure.

Related Industries

Tell us about your business

Send your line of business, rough annual turnover, and what is going wrong. We reply on WhatsApp.

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