Report Writting 01

Tax Dilemma on E-commerce Business in Indonesia

Recently Indonesia's finance ministry is conducting a study of the taxation for online commerce transactions or e-commerce in Indonesia. The focus of study that conducted by Indonesia's finance minister is the type of model and how the transaction will be taxed. As mentioned in kompas.com editorial July 22, 2017, head of fiscal policy ministry of finance, Suahasil Nazara said, in this study the government will ensure the equal level of playing field between e commerce business entrepreneurs with conventional business. However, i think there will be positive and negative effects that will be occur.

First, the simple analysis from the benefit of this policy is increase of the country income. After the government implemented a tax amnesty policy in previous year that is considered far from expectations, e-commerce tax levies is expected to be a new source of revenue for the country. In addition, the government has a tax revenue target up to 9.3% in the APBN (State budget revenues) draft of 2018. One of the possible way is by e-commerce business tax levies, given that e-commerce business in Indonesia is growing rapidly in the last three years.

However, in addition to predicting the benefit of this e-commerce tax levies, the government must also be careful in assessing the readiness of systems and objects. According to the Central Bureau of Statistics in Indonesia, the number of e-commerce has increased by 17% within 10 years. At least until now the number of e-commerce in Indonesia reached 26.2 million. The large of number of e-commerce businesses in Indonesia, the Central Bureau of Statistics has not completed detailed data on the types of businesses and locations where e-commerce operates. This should be the main focus. The taxing only for those who have a website portal or all e-commerce business owners including those who only use social media like facebook, twitter and istagram. Or including the facebook, twitter and instagram platform should also be taxed as they are also used for e-commerce business.

Then for small entrepreneurs who just start a business, they choose e-commerce to increase sales and minimize costs incurred. The e-commerce tax levies is likely to also reduce their business activity. E-commerce business forms that are easier and more practical to do will support the economic independence of the society. when the societi’s productivity and the societi's income increase their consumption will also increase, and this needs to be maintained because it also has a positive impact on the economy in Indonesia.

At the last, I just want to emphasize that the government has to prepare a lot to do this policy. The government should not just focus to increase the income in APBN (State budget revenues) but also supporting all the businessman who started to build his own business. Because in the future if many successful business people in Indonesia, especially local people, they will also contribute to improve the economy in Indonesia.

References :

http://ekonomi.kompas.com/read/2017/08/22/101600526/sri-mulyani-masih-kaji-pengenaan-pajak-e-commerce

http://ekonomi.kompas.com/read/2016/04/06/185551526/CEO.Bhinneka.com.Pajak.E-Commerce.Jangan.Dicari-cari.Lagi

http://bisnis.liputan6.com/read/2602680/bps-jumlah-e-commerce-di-indonesia-capai-262-juta

https://www.cnnindonesia.com/ekonomi/20170403103842-78-204494/core-hasil-tax-amnesty-jauh-dari-ekspektasi/