Latest news with #taxregulation
Free Malaysia Today
16 hours ago
- Business
- Free Malaysia Today
Indonesia to make e-commerce firms collect tax on sellers' sales
E-commerce platforms argue that the regulation could raise administrative costs and drive sellers away from online marketplaces. (Reuters pic) JAKARTA : Indonesia plans to implement new regulations requiring e-commerce platforms to withhold tax on their sellers' sales income in a bid to boost revenues, according to two industry sources informed of the move and a document seen by Reuters. The planned directive, which also aims to level the playing field with brick-and-mortar shops, could be announced as soon as next month, one of the sources said, as Southeast Asia's largest economy grapples with weak revenue collection. The changes would affect the country's main e-commerce operators, including ByteDance's TikTok Shop and Tokopedia, Sea Limited's Shopee, Alibaba-backed Lazada, Blibli and Bukalapak, one of the sources said. E-commerce platforms are opposing the regulation, arguing it could increase administrative costs and push sellers away from online marketplaces, said the sources, who were briefed on the plan by tax authorities. Indonesia introduced a similar regulation in late 2018, requiring all marketplace operators to share sellers' data and make them pay taxes on sales income, but withdrew it three months later due to a backlash from the industry. The sources asked not to be named as they were not authorised to speak publicly about the matter. Indonesia's finance ministry, which will be responsible for issuing the order, declined to comment. Indonesia's e-commerce industry association idEA would not confirm or deny details of the plan. However, it said the policy will affect millions of sellers if implemented. Finance ministry data showed revenues fell 11.4% year on year in the January to May period to US$61 billion due to low commodity prices, weak economic growth and disruptions to tax collection caused by a system upgrade. Indonesia's e-commerce industry, meanwhile is booming, with last year's estimated gross merchandise value of US$65 billion expected to grow to US$150 billion by 2030, according to a report by Google, Singapore state investor Temasek and consultancy Bain & Co. The sources said that under the new rule e-commerce platforms will be required to withhold and pass onto the authorities tax amounting to 0.5% of sales income from sellers with annual turnover of between 500 million rupiah and 4.8 billion rupiah. Those sellers are considered small and medium-sized enterprises and are already required to pay that tax directly. One of the sources added that there was also a penalty proposed for late reporting by e-commerce platforms. The sources' comments were corroborated by the contents of an official presentation the tax office made to operators that was seen by Reuters. In addition to the expected additional administration costs, e-commerce platforms are expressing concern the current tax system, which has been facing technical problems after an upgrade at the start of the year, will struggle to handle the amount of data the tax office is asking marketplaces to share.
Yahoo
4 days ago
- Business
- Yahoo
Indonesia working on new e-commerce tax rule in bid to target 'shadow economy'
By Stefanno Sulaiman JAKARTA (Reuters) -Indonesia is working on a new regulation that will require e-commerce platforms to collect and pass on sellers' sales income in a bid to tackle the "shadow economy", its tax office said on Thursday, confirming a Reuters report earlier this week. Citing sources, Reuters reported exclusively on Tuesday about a planned directive that e-commerce platforms must withhold and pass onto the authorities a levy amounting to 0.5% of sales income from small and medium-sized sellers. Sources said the rule could be introduced as early as next month, though a statement from the tax office did not give any schedule amid concerns from some platforms that they would need time to implement such a directive. "The rule is still in the works and will be announced and explained to the public after," the statement said, adding that e-commerce platforms and other stakeholders have been consulted and have so far given their backing. Indonesia's e-commerce association idEA said on Wednesday that it will comply with any government policy, but expressed concern over implementation timelines, stressing that it needed to be handled carefully as it will impact millions of sellers. The changes would affect the country's main e-commerce operators, including ByteDance's TikTok Shop and Tokopedia Sea Limited's SE.N Shopee, Alibaba-backed Lazada, Blibli and Bukalapak one of the sources said. Sources also told Reuters there could be penalties for late reporting. ByteDance's TikTok, which runs Tokopedia, one of Indonesia's biggest e-commerce platforms, told Reuters in a statement that it would need time to implement the directives. Tokopedia has around 12 million sellers listed on its platform, and, in 2023, the total value of transactions reached 249 trillion rupiah ($15.3 billion), according to a company presentation. "We hope its implementation takes into account the need for adequate preparation time for various aspects. This includes the technical readiness of platforms and the capacity of sellers, especially small and medium-sized enterprises, to comply," TikTok said in the statement. The tax office said the regulation was intended to improve supervision of the "shadow economy" and vendors who do not pay taxes because of the perceived complexity of the filing process. Indonesia's has a booming e-commerce industry, with last year's estimated gross merchandise value of $65 billion expected to grow to $150 billion by 2030, according to a report by Google, Singapore state investor Temasek and consultancy Bain & Co. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Reuters
4 days ago
- Business
- Reuters
Indonesia working on new e-commerce tax rule in bid to target 'shadow economy'
JAKARTA, June 26 (Reuters) - Indonesia is working on a new regulation that will require e-commerce platforms to collect and pass on sellers' sales income in a bid to tackle the "shadow economy", its tax office said on Thursday, confirming a Reuters report earlier this week. Citing sources, Reuters reported exclusively on Tuesday about a planned directive that e-commerce platforms must withhold and pass onto the authorities a levy amounting to 0.5% of sales income from small and medium-sized sellers. Sources said the rule could be introduced as early as next month, though a statement from the tax office did not give any schedule amid concerns from some platforms that they would need time to implement such a directive. "The rule is still in the works and will be announced and explained to the public after," the statement said, adding that e-commerce platforms and other stakeholders have been consulted and have so far given their backing. Indonesia's e-commerce association idEA said on Wednesday that it will comply with any government policy, but expressed concern over implementation timelines, stressing that it needed to be handled carefully as it will impact millions of sellers. The changes would affect the country's main e-commerce operators, including ByteDance's TikTok Shop and Tokopedia opens new tab, Sea Limited's SE.N, opens new tab Shopee, Alibaba-backed opens new tab Lazada, Blibli and Bukalapak opens new tab, one of the sources said. Sources also told Reuters there could be penalties for late reporting. ByteDance's TikTok, which runs Tokopedia, one of Indonesia's biggest e-commerce platforms, told Reuters in a statement that it would need time to implement the directives. Tokopedia has around 12 million sellers listed on its platform, and, in 2023, the total value of transactions reached 249 trillion rupiah ($15.3 billion), according to a company presentation. "We hope its implementation takes into account the need for adequate preparation time for various aspects. This includes the technical readiness of platforms and the capacity of sellers, especially small and medium-sized enterprises, to comply," TikTok said in the statement. The tax office said the regulation was intended to improve supervision of the "shadow economy" and vendors who do not pay taxes because of the perceived complexity of the filing process. Indonesia's has a booming e-commerce industry, with last year's estimated gross merchandise value of $65 billion expected to grow to $150 billion by 2030, according to a report by Google, Singapore state investor Temasek and consultancy Bain & Co.
