Taxation ยท KBLI 46100

Import Export & Trading

Import and export transactions in Indonesia trigger multiple tax and customs obligations that span the entire trade cycle. Imported goods are subject to 11% VAT calculated on CIF value plus import duties, Article 22 income tax at rates ranging from 2.5% (with an Importer Identification Number) to 7.5% (without API), and customs duties varying by HS code classification. On the export side, goods are subject to 0% VAT, which generates ongoing VAT overpayment positions that require structured refund applications. International traders must also navigate bonded zone facilities, free trade agreement preferences, transfer pricing documentation for related-party cross-border transactions, and the correct classification of goods under the HS code system. Managing these obligations effectively requires integrated systems that track customs documentation, tax payments, and VAT positions across every shipment. Arunika Consulting provides comprehensive tax and customs advisory for companies engaged in international trade through Indonesia.

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What usually goes wrong

  • Border Tax Documentation

    Import duties, VAT on imports, and Article 22 income tax must be supported by complete customs documentation โ€” any gap in PIB or supporting records risks assessments.

  • Export VAT Refund Process

    The 0% export VAT rate creates ongoing overpayment positions requiring structured refund applications โ€” the refund process can take 1 to 12 months depending on the taxpayer's risk rating.

  • Transfer Pricing for Affiliated Trade

    Cross-border transactions with related parties require robust transfer pricing documentation demonstrating arm's length pricing for goods, royalties, and management fees.

  • HS Code Classification Accuracy

    Incorrect HS code classification can lead to underpayment or overpayment of duties, VAT, and Article 22 tax โ€” and can trigger customs audits and penalties.

  • Bonded Zone Customs Compliance

    Companies using bonded zone facilities must maintain strict inventory records and customs documentation to avoid duty and tax reassessments on goods stored in bonded warehouses.

What we do

  1. 01

    Import VAT and Article 22 Compliance

    Systematic management of import VAT and Article 22 income tax calculations based on correct HS code classification, available facilities, and API status for every shipment.

    • Organized documentation
    • Low correction risk
    • Controlled cash flow
  2. 02

    Structured Export VAT Refund

    Preparation of complete refund documentation with tax invoice reconciliation, PEB matching, and application for preliminary refund mechanism for low-risk exporters.

    • Faster overpayment refund
    • Minimal audit findings
    • Efficient process
  3. 03

    Transfer Pricing Documentation

    Preparation of transfer pricing documentation for cross-border affiliated transactions including master file, local file, and country-by-country reporting as required.

    • Strong defensive position
    • Clear compliance trail
    • Reduced dispute risk
  4. 04

    HS Code Classification Review

    Systematic review of all imported and exported product HS codes to ensure correct classification and optimal duty rates, including free trade agreement preference utilization.

    • Correct duty application
    • FTA benefits maximized
    • Lower dispute risk

Related regulations

  • PPN Impor

    VAT on Imported Goods

    11% VAT calculated from Import Value (CIF + Import Duty)

  • PPh Pasal 22 Impor

    Article 22 Income Tax on Imports

    2.5% Article 22 Import Tax (with API) or 7.5% (without API) from Import Value

  • PPN Ekspor

    VAT on Exported Goods

    Exported goods subject to 0% VAT (zero rate)

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

How can I reduce the Article 22 import tax rate?

By obtaining an Importer Identification Number (API), the Article 22 import tax rate decreases from 7.5% to 2.5% of the import value. The API is issued by the Ministry of Trade and requires the company to have a business license, NPWP, and meet specific operational requirements. Without an API, only the higher 7.5% rate applies and no tax credit can be claimed.

How long does the export VAT refund process take?

For taxpayers meeting the preliminary refund criteria (low-risk rating, good compliance history), the export VAT refund process takes approximately 1 month. For standard refund applications, the process takes 6-12 months depending on the depth of the DGT examination. Proper documentation including complete tax invoices and PEB records significantly impacts processing speed.

What is a bonded zone and what are the tax benefits?

A bonded zone is a designated area where imported goods can be stored, processed, or assembled with suspension of import duties, VAT, and Article 22 income tax. Tax is only payable when goods are released into the domestic customs area. This provides significant cash flow benefits for companies that process imported materials for re-export or domestic sale. Bonded zone operators must maintain rigorous inventory and customs documentation.

What customs documentation must be maintained for tax purposes?

For every import shipment: PIB (customs declaration), commercial invoice, packing list, bill of lading, and duty payment receipts. For exports: PEB, commercial invoice, and packing list. These documents support the VAT credit claims, Article 22 tax credits, and the export VAT refund application. Documentation should be maintained for at least 10 years per Indonesian tax law requirements.

Do cross-border related party transactions require special tax documentation?

Yes, companies engaged in cross-border transactions with related parties (affiliates, parent companies, sister companies) must prepare transfer pricing documentation demonstrating arm's length pricing. This includes a master file, local file, and for groups exceeding IDR 11 trillion in revenue, country-by-country reporting. The documentation covers goods pricing, royalty payments, management fees, and intercompany services.

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.

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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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