Benefit in Kind Tax Regulation to be Released This Month

JAKARTA. The Ministry of Finance said that the preparation of technical rules regarding benefit-in-kind tax has been completed. In fact, the process of harmonizing the regulation in the form of a Minister of Finance Regulation (PMK) has been completed.

Quoting Kontan.co.id, therefore the PMK regarding the in-kind tax is ready to be released in June 2023.

The regulation will clarify the benefit-in-kind provisions that were previously regulated in the Income Tax Law amended by the Law on Harmonization of Tax Regulations.

Previously, changes to the in-kind provisions were also regulated in Government Regulation (PP) Number 55 of 2022.

There are two definitions of compensation stipulated in Government Regulation Number 55 of 2022. First, compensation in the form of benefit in kind, namely goods other than money. In this case, money also refers to checks, savings balances, electronic money, or digital wallet balances.

Second, compensation in the form of Fringe benefit is compensation in the form of the right to use a facility and/or service. Facilities and/or services from the provider to the recipient may originate from the provider's assets or a third party's assets that are leased and/or financed by the provider.

In general, the government stipulates that reimbursement or compensation in benefits in kind and/or fringe benefits is the object of income tax or is subject to tax.

However, there are several things that still need further explanation. For example, related to benefits in kind/fringe benefits in certain areas, whose categorization and definition are too broad and still raise questions.

Likewise non-object income tax in the form of benefits in kind with certain types and limitations, which are still unclear. Especially regarding the type and value of benefits in kind, as well as the criteria for the recipient. (ASP/KEN)