Corona Virus Disease 2019 (Covid-19) pandemic has given tremendous impact on the global economy, including Indonesia. In fact, the Organization for Economic Co-operation and Development (OECD) warned about the danger of the global recession due to Covid-19, which was further predicted to be more severe than the global financial crisis of 2008. Its symptoms have been seen from China's economic growth which is minus 6.8% in the first quarter of this year.
This condition is likely to hit all of the economic layers, including multinational companies whose income will experience a significant decline. It will also certainly affect the transfer pricing policy, analysis and documentation of company group affiliation transaction reports.
Indonesia also could not escape from the effects of the pandemic. This was reflected in the economic growth which is only 2.97% in the first three months of 2020. The government estimates that the Indonesian economy will only grow around 2.3% this year, far below the target of 5.3% in the 2020 State Budget. In fact, with the worst case scenario, economic contraction could have occurred with a growth of minus 0.5% if the pandemic cannot be overcome.
To counteract the negative impact of the Covid-19 pandemic on the economy, many countries in the world simultaneously poured out economic stimulus. Likewise Indonesia, following the government's policy to allocate an additional budget of IDR 405 trillion to stimulate the economy.Tax incentive package is part of the massive stimulus policy.
Interestingly, through Government Regulation in Lieu of Law (Perppu) No. 1 of 2020, Indonesia is also accelerating the implementation of taxation on E-commerce (PMSE). Taxation of online trade transactions began to be implemented starting in the tax year of 2020, using the Value Added Tax (VAT), Income Tax (PPh), and new tax types as an alternative if the Income Tax scheme is blocked by tax treaty.
In line with PMSE taxation, the Government of Indonesia is also renewed the concept of determining the nexus, from previously making physical presence as a condition in determining an entity, to be based on a significant economic presence. This renewal of the Nexus concept is actually an old discourse based on the OECD agenda which will become a global consensus at the end of this year.
Recent economic dynamics and global stimulus policies - especially with the Covid-19 pandemic - are interesting topics to discuss. Especially related to international taxation practices that will more or less be affected by the global economic crisis.
Therefore, MUC Consulting, which is dominated by young consultants, re-initiated the webinar as an online discussion platform through the MUC Bicara Pajak (#MUCBijak) program.The third online discussion will raise the theme "Covid-19 Impact on International Taxation Practices", which is planned to be held on:
|Day/Date||Wednesday, 15 May 2020|
|Time||2:00 PM to 3:00 PM|
|Platform||Zoom and Live Streaming on Youtube & Instagram @MUCConsulting|
In accordance with the theme, #MUCBijak will present the speaker Prof. John Hutagaol (Director of International Taxation of DGT) and Wahyu Nuryanto (Executive Director of MUC Tax Research Institute). The webinar will be guided and moderated by MUC Consulting consultant, M. Arif Darmawan.
#MUCBijak discussion is open for public and free of charge. Prospective participants can register through the link Bit.ly/MUCBijak3 to be able to get a Zoom access ID (limited quota), which will be confirmed by the Committee. For participants who do not get Zoom access, they can still follow the discussion via live streaming on @MUCConsulting Youtube channel and Instagram account.
The program is also supported by MUC Butterfly Effect, a donation project that is currently focused on helping medical teams and small communities affected by the Covid-19 pandemic. Through this event, we invite all parties to set aside some of your sustenance to help those affected by the Covid-19 pandemic.