Gold Purity Threshold for VAT Facility Set to Be Relaxed

JAKARTA, DDTCNews - Coordinating Minister for Economic Affairs, Airlangga Hartarto, has stated that the government is currently preparing a special value added tax (VAT) incentive for the jewellery industry.

Airlangga explained that the government will establish new standards for jewellery industry players so that they may utilise VAT facilities on the supply of precious metals with a minimum purity of 99.9%.

"For the jewellery industry, new standards will be introduced whereby they can utilise the facilities for precious metals at 99.9%," he said, as quoted on Thursday (1/10/2026).

Under the current provisions, the facilities are granted for precious metals with a purity of 99.99%. Accordingly, an adjustment to the provisions governing those facilities will be required.

"The current regulation applies to those at 99.99%. So there will be an amendment to the government regulation (Gov. Reg.)," said Airlangga.

For information, gold bullion with a purity of 99.99%, other than those held for foreign exchange reserve purposes, constitutes taxable goods (barang kena pajak/BKP) whose import or supply is exempt from VAT collection pursuant to Gov. Reg. 49/2022.

The gold bars exempt from VAT collection in question are gold bars with a minimum purity of 99.99% evidenced by a certificate, including gold bars whose ownership recording is carried out electronically.

Accordingly, gold bars with a purity lower than the threshold set out in Gov. Reg. 49/2022 constitute taxable goods whose supply or import is subject to VAT. (rig)