Indonesia imposes tax and VAT on crypto income and purchases at 0.1%

The Indonesian government announced the imposition of an income tax of 0.1% on crypto income and VAT on crypto purchases on April 1. The director of tax regulations at the Ministry of Finance, Hestu Yoga Saksama, confirmed to CNN Indonesia that the Indonesian government has decided to tax capital. earns income from crypto investments at 0.1%. The same rates would be levied on Value Added Tax (VAT) on crypto purchases. Both taxes would be applicable from 1 May. The government is still working on the implementation of tax regulations.
The director explained the rationale for imposing income tax and VAT on crypto purchases. The Indonesian government has levied income tax and VAT on crypto purchases because the central bank, Bank Indonesia, and the Ministry of Commerce consider crypto to be a commodity and not a means of payment. However, Saksama said that crypto assets are also not considered currency.
It should also be noted that the VAT imposed on crypto assets is much lower than the 11% VAT levied on most goods and services in Indonesia. adding that the 0.1% income tax on capital gains matches that on stocks listed on the Indonesian stock exchange.
Adoption of crypto assets has increased in Indonesia during the COVID-19 pandemic, with the number of crypto asset holders increasing exponentially to 11 million by the end of 2021. Crypto asset transactions on Commodity futures markets reached $59.8 billion in 2021, which was more than 10 times the transaction value of 2020, according to data from the Commodity Futures Trading Regulatory Agency, Reuters reported. Currently, the Indonesian government allows crypto assets to be traded as commodities but prohibits using them as payment.
The new taxation comes after Indonesia’s parliament approved a law in October 2021 for major tax revisions, including a VAT increase in 2022 to generate more revenue that has been hit during the pandemic and ensure tax compliance.
For the latest crypto news and investment tips, follow our Cryptocurrency page.

About Natalee Broderick

Check Also

Veryfi Reveals Improved Mobile Receipt Capture for DTC Marketing Apps

At Retail Innovation Conference & Expo, Company Demonstrates Latest Artificial Intelligence-Based Capabilities for Consumer Packaged …