US Government Extends 3 Month Deadline for Income Tax Repayment

WASHINGTON,D.C. - The Government of the United States (US) extended three months or 90 days deadline for payment of income tax (Pajak Penghasilan/PPh) specifically for tax arrears in 2019, from the due 15 April 2020 to 15 July 2020.

This facility is intended for taxpayers with tax payable value of a maximum of USD 1 million for individual taxpayer and at most USD 10 million for corporate taxpayer arrears.

Treasury Secretary Steven Mnuchin in a press conference at the White House, Tuesday (17/3) said, this relaxation was taken by US Government as an attempt to dampen the impact of the Covid-19 pandemic against the economic burden of taxpayers.

Previously, similar relaxation policies were also taken by the Government of Indonesia by extending the deadline of individual income tax (PPh OP) submitting, from which it should be on 31 March 2020 to 30 April 2020. In addition, in order to reduce the impact of Corona virus distribution, Indonesia also provides a number of tax incentives as follows:

• Covering income tax (PPh) Article 21 for workers with a maximum income of Rp200 million in the manufacturing sector.

• Exempting Income Tax Article (ITA) 22 on import PPh-22 in 19 specific sectors, taxpayers (Wajib Pajak/WP) of Import Facilities for Export Purposes (Kemudahan Impor untuk Tujuan Ekspor/KITE)  and taxpayers of Import Facility for Export Purposes - Small and Medium Enterprises (WP KITE-IKM)

• Reduction of ITA 25 by 30 percent for 19 specific sectors, WP KITE, and WP KITE-IKM

• Accelerating Value Added Tax (VAT) refunds for 19 specific sectors, WP KITE, and WP KITE-IKM

• Increasing the limit on the value of restitution for VAT- registered persons (Pengusaha Kena Pajak/PKP) from IDR 1 billion to IDR 5 billion. (KEN)