The government issued tax incentives for the import of vaccines and equipment needed to produce the Corona Virus Disease 2019 (Covid-19) vaccine.
The incentives provided are in the form of exemption of import duty, including anti-dumping import duty, reward import duty, safeguard import duty and retaliatory import duty. Apart from that, the government will also waive Value Added Tax (VAT) and Sales Tax on Luxury Goods (STLG) and exempt Income Tax Article (ITA) 22 on Import.
The policy is stated in the Minister of Finance Regulation (PMK) number 188 / PMK.04 / 2020 which was published and came into force on 26 November 2020.
In the regulation, it is explained that facilities are not only given for goods imported directly, but also for goods imported through the Bonded Logistics Center (PLB) or goods released from Bonded Zones or Bonded Warehouses, Free Zones or Special Economic Zones (KEK) as well as from companies receiving Import Facility for Export Purpose (KITE)
Limited Facility Recipients
Not just any party can apply for the facilities. But only parties related to the handling of the Covid-19 pandemic are entitled to this tax incentive, such as the Central Government, local governments and parties appointed by the Ministry of Health (Kemenkes).
To obtain the facilities, eligible importers can submit applications to the Minister of Finance, through the Head of the Customs and Excise Office where vaccines are imported or released using the Indonesia National Single Window (INSW) system.
The application document must be accompanied by data on the number and type of goods and permits from the related technical agencies if it is related to the import of prohibited and or restricted (lartas) goods. In addition, a copy of the Business Identification Number (NIB) or Taxpayer Identification Number (NPWP) must also be attached, a letter of appointment and a recommendation from the Ministry of Health.
Evaluation and Penalties
For the provision of these incentives, the government will monitor, evaluate and conduct examinations to ensure that vaccines are actually used to combat the Covid-19 pandemic.
If there is any violation or misuse of facilities, the party who gets the incentive is obliged to pay import duties, excise or taxes in the framework of imports (PDRI) that were previously exempted. Also, importers will also be subject to administrative sanctions in the form of fines ranging from 100% to a maximum of 500% of the import duty that should be paid.
In addition, offenders also have the potential to receive additional penalties in accordance with the Law in the field of excise or taxation as well as the threat of administrative sanctions in the form of blocking customs access for one year.