Waiting for Coretax to Launch, DGT Delays the VAT Centralization by Position

The Directorate General of Taxes (DGT) has postponed the centralization of Value Added Tax (VAT) payable by position for VAT-Registered Persons (PKP) who do not submit a notification of VAT payable centralization. 

The VAT payable centralization by position will only be carried out after the release of the Coretax Administration System (Coretax). Regarding the release time of Coretax, the DGT stated it would be delivered at a later date.

This was conveyed in the Announcement of the Director General of Taxes Number PENG-26/PJ/09/2024 issued on Monday (9/9). The provision also confirms the previous regulation as stated in Director General of Taxes Regulation Number PER-6/PJ/2024 and Announcement Number PENG-4/PJ.09/2024.

Provisions Regarding the Use of TIN for Branch VAT-Registered Persons

Therefore, VAT-Registered Persons who have not yet submitted a notification of the centralization location of VAT payable can use the central Taxpayer Identification Number (TIN) or branch TIN.

The central TIN is applicable for branch taxpayers who are not VAT-registered persons. Meanwhile, the Branch TIN  is used if the branch taxpayer is registered as a VAT-registered person. 

In this regard, the DGT urges VAT-Registered Persons who have not yet submitted a notification of the centralization location of VAT payable to do so promptly. This step is necessary to help taxpayers comply with tax provisions.

Procedures for Notification of VAT Payable Centralization

The provisions regarding the procedure for submitting the notification of VAT payable centralization are regulated in the Regulation of the Director General of Taxes Number PER-11/PJ/2020.

Based on this regulation, any VAT-registered person with more than one location where VAT is payable can choose one or more places as the location for VAT payable. Furthermore, a VAT-registered person is then required to maintain both transfer administration and financial administration at the business location designated as the place for VAT payable centralization.

The business location selected as the VAT payable concentration must have VAT-Registered Person status. However, VAT payable centralization cannot be applied to the following locations:

Located in a Bonded Storage Area, including Bonded Zones;
Located in a Special Economic Zone;
Located in a Free Trade Zone;
Located in other facilitated zones;
Receiving import facilities for export purposes (KITE); and/or
Engaging in business activities related to the transfer of land and/or buildings.

Additionally, a location that cannot be chosen as the place for VAT payable centralization is one that does not have business activities or does not perform transfer administration and financial administration. (ASP/KEN)