Taxation ยท KBLI 10200

Seafood Processing Tax

Indonesia's seafood processing industry is a significant export sector with unique tax obligations driven by its export orientation. Seafood processors face Article 22 export income tax at 0% for exporters with valid API (Importer Identification Number) or 0.5% without API, 0% VAT on export sales while paying full input VAT on raw materials creating regular refund cycles, potential export duties on certain raw products, and tax allowance incentives for new processing facility investments. The industry's raw material sourcing โ€” purchasing fresh catch from fishing vessel operators and traditional fishermen โ€” introduces specific withholding tax obligations (PPh 22 on agricultural purchases) that must be correctly managed. Cold storage, processing facilities, and refrigerant costs generate significant input VAT positions requiring systematic documentation for refund claims. With seafood exporters routinely audited by both Customs and the DGT, comprehensive documentation of every shipment's PEB (export declaration), supplier invoices, and cold chain costs is essential for smooth compliance. Arunika Consulting provides specialized tax advisory for seafood processors and exporters navigating Indonesia's fishery tax framework.

Chat on WhatsApp All services

What usually goes wrong

  • Export Article 22 Tax Rate by API Status

    Exporters with valid API pay 0% Article 22 export income tax, while those without API pay 0.5% โ€” maintaining API status and proper documentation is essential for optimal tax treatment.

  • Ongoing Export VAT Refund Cycle

    Export sales at 0% VAT generate constant overpayment positions while input VAT on raw materials, cold storage, and processing costs is paid in full โ€” requiring structured refund management.

  • Export Duty on Raw Products

    Certain raw or minimally processed seafood products may be subject to export duties designed to encourage domestic processing โ€” rates vary by HS code and destination market.

  • Raw Material Purchase Withholding

    Purchases of fresh seafood from fishermen and suppliers are subject to PPh 22 at 0.25% on the purchase value โ€” tracking thousands of small purchases requires systematic processes.

  • Certificate of Origin for FTA Benefits

    Seafood exporters must maintain correct certificate of origin documentation (SKA, Form E for ASEAN) to claim preferential duty rates in destination markets.

What we do

  1. 01

    Export Tax Compliance System

    Management of Article 22 export income tax with correct API status application, PEB documentation verification, and accurate export duty calculation for seafood products.

    • Optimal PPh 22 rate
    • PEB verified
    • Export duty accuracy
  2. 02

    VAT Refund Management

    Structured documentation of input VAT on raw materials, cold storage, and processing costs for fast-track refund applications using the preliminary refund mechanism for low-risk exporters.

    • Smooth refund process
    • Optimal cash flow
    • Audit-ready documentation
  3. 03

    Raw Material Tax Compliance

    Management of PPh 22 on purchases from fishing vessel operators and traditional suppliers, with correct withholding rates, documentation, and reporting.

    • WHT compliance
    • Supplier relations
    • Complete documentation
  4. 04

    Tax Allowance Application

    Support for tax allowance applications under PP 78/2019 for new seafood processing facility investments and cold storage capacity expansion.

    • Tax facilities reviewed
    • Maximum incentives
    • Full compliance

Related regulations

  • PMK-34/2017

    Export Income Tax

    Export income tax on seafood exports

  • PMK-65/2021

    Seafood Export Duty

    Export duty provisions for certain seafood products

  • PP 46/2019

    Export Tax Allowance

    Tax allowance for export-oriented processing industry

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 export income tax rate for frozen seafood?

Exporters with a valid API (Importer Identification Number) benefit from a 0% Article 22 export income tax rate. Exporters without API or conducting irregular exports face a 0.5% rate on the export value. The export tax is final for certain exporters. Maintaining a valid API and ensuring PEB (Export Declaration) documents are accurately filed are essential for applying the correct rate.

Are seafood exports subject to export duties?

Certain raw or minimally processed fishery products may be subject to export duties to encourage downstream processing within Indonesia. Processed products such as frozen fillets, canned seafood, and surimi are generally exempt from export duties. Exporters should verify the specific HS code classification in the latest BTKI (Indonesian Customs Tariff Book) to determine applicable duties.

How is VAT handled for seafood exports?

Exports of seafood products are subject to 0% VAT (not collected). The exporter must have a valid PEB validated by Customs to support the 0% VAT treatment. Input VAT on raw material purchases, cold storage costs, and processing expenses can be refunded through the VAT refund mechanism. Exporters meeting certain criteria can apply for low-risk PKP status to access fast-track refund processing.

What withholding tax applies when buying fish from fishermen?

Purchases of fresh seafood from individual fishermen or suppliers by processing companies are subject to PPh 22 withholding at 0.25% of the purchase value (excluding VAT). If the supplier does not have an NPWP, the rate increases to 0.5%. This withholding is non-final and serves as a tax credit for the purchasing company. Proper documentation of each purchase transaction is essential.

What tax incentives are available for seafood processing investments?

Seafood processing companies investing in new facilities may qualify for tax allowance under PP 78/2019, providing a 30% reduction in net taxable income spread over 6 years, accelerated depreciation, extended loss carryforward, and reduced withholding tax on dividends. The investment must meet minimum thresholds and obtain BKPM approval. Export-oriented processors may also qualify for additional export incentives.

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.

Chat on WhatsApp