Will Marketplaces Collect Article 22 Tax? Not Necessarily

Question:

MY NAME is Revindita. I am a resident of DKI Jakarta and have been conducting business as a merchant on Shopee since the beginning of 2025. Recently, I heard about a new regulation requiring marketplaces to collect a tax of 0.5% from merchants' income.

As a micro, small, and medium enterprise (MSME) entrepreneur whose turnover is still relatively low and has not yet reached IDR500 million per year, I am quite concerned that this policy will directly reduce my daily income. Does this collection rule apply to all merchants without exception? Or are there exemptions applicable to my business situation? If so, what procedure must I undertake to avoid tax collection by the marketplace? I would appreciate an explanation. Thank you.

Revindita, DKI Jakarta.

Answer:

THANK you for your question, Ms Revindita. It is indeed the case that e-commerce operators (penyelenggara perdagangan melalui sistem elektronik/PPMSE in Indonesian)—of which a marketplace is one example—appointed by the government may collect a tax of 0.5% from the turnover of domestic merchants. See All Marketplaces Will Eventually Be Appointed as Tax Collection Agents

This is as mandated under the Minister of Finance Regulation No. 37 of 2025 concerning the Appointment of Other Parties as Income Tax Collection Agents as Well as Procedures for the Collection, Remittance and Filing of Income Tax Collected by Other Parties on Income Received or Accrued by Domestic Merchants Using Electronic Commerce Mechanisms (MoF Reg. 37/2025). This regulation will serve as the basis for addressing your question.

Pursuant to the above regulation, the mandate in question essentially refers to Article 2 paragraph (1) and (2) of MoF Reg. 37/2025, which affirms that marketplaces satisfying certain criteria will be appointed as Article 22 Income Tax collection agents on turnover received by domestic merchants.

Referring to Article 1 number 9 of MoF Reg. 37/2025, the definition of a domestic merchant is an entrepreneur domiciled in Indonesia that engages in e-commerce, whether through its own electronic system or that of an e-commerce operator—hereinafter referred to in this article as a merchant.

For your information, as of the first half of 2026, the director general of taxes has appointed 4 marketplaces, namely Tokopedia, Shopee, Lazada and Blibli. Subsequently, all marketplaces will gradually be appointed as Article 22 Income Tax collection agents for merchants. This is as explained in Press Release No. SP-14/2026 dated 1 July 2026, issued by the Directorate General of Taxes (DGT).

So, will every merchant on these marketplaces definitely be subject to Article 22 Income Tax collected by the marketplace?

Referring to the situation you described above, the business activity you conduct as a merchant on Shopee essentially falls within the definition of a domestic merchant. However, you need not be concerned. This is because there are several conditions under which a marketplace is not required to collect Article 22 income tax, as regulated under Article 10 paragraph (1) of MoF Reg. 37/2025. Those conditions are as follows:

1. Sales of goods and/or services by resident individual taxpayers who have a gross turnover of up to IDR500 million rupiah in the current tax year and have submitted a statement letter.
2. Sales of goods and/or services by domestic merchants that submit information on the Withholding Tax and/or Income Tax collection exemption certificate (surat keterangan Bebas/SKB in Indonesian).
3. Sales of courier or forwarding services by individual resident taxpayers as partners of technology-based application companies that provide transportation services.
4. Sales of mobile phone credits and SIM card starter packs.
5. Sales of gold jewellery, gold bullion, non-solid gold jewellery, gemstones and/or other similar stones, conducted by gold jewellery manufacturers, gold jewellery merchants and/or gold bullion entrepreneurs
6. Transfers of the right to land and/or building or land and/or building sale and purchase agreements and the amendments thereto.

Referring to the above provisions, as a merchant who is an individual taxpayer with turnover below IDR500 million per year, you technically fall within the criteria excluded from Article 22 Income Tax collection by Shopee as a marketplace. In other words, Shopee will not collect Article 22 Income Tax from you.

Important to Note!

Nevertheless, as a merchant, you are not automatically excluded from Article 22 Income Tax collection. This is because, pursuant to Article 10 paragraph (1) subparagraph a of MoF Reg. 37/2025, there is a clause 'have submitted a statement letter'. This implies that even when your turnover is below IDR500 million, you must still submit a statement letter to the marketplace. This is as regulated under Article 6 of MoF Reg. 37/2025.

For your information, the format of the statement letter may refer to Appendix A of MoF Reg. 37/2025. The contents of the statement letter that must be submitted to the marketplace include:

1. Taxpayer Identification Number (TIN) or national identification number (nomor induk kependudukan/NIK in Indonesian) along with a correspondence address. This is as affirmed under Article 6 paragraph (1) of MoF Reg. 37/2025.
2. A statement that the turnover you earn in the current tax year is still no more than IDR500 million. This is as affirmed under Article 6 paragraph (2) of MoF Reg. 37/2025.

Please note that the statement letter must also be resubmitted at the beginning of each subsequent tax year, provided that the turnover you earn within one tax year does not exceed IDR4.8 billion. This is as regulated under Article 6 paragraph (5) of MoF Reg. 37/2025.

In addition, it should also be understood that if you do not submit the above statement letter to the marketplace, the 0.5% Article 22 income tax collection will continue to apply.

Based on the above explanation, it can be concluded that, according to the situation you described, as a merchant with turnover below IDR500 million, you will not have Article 22 income tax collected, provided that you have submitted the statement letter to the marketplace.

On another note, the Shopee platform has also provided a means for merchants to upload the required documents, with a submission deadline of no later than 1 August 2026. See To Avoid Article 22 Withholding Tax, Shopee Merchants Urged to Upload This Letter

That concludes the answer we can provide. We hope it is helpful.

For your information, the Tax Consultation article is published every week to answer selected questions from loyal DDTCNews readers. For those wishing to submit a question, please send it to the following e-mail address: [email protected]. (dik)