MoF Reg. Issued, Government-Borne VAT Incentive Extended to Year-End

JAKARTA, DDTCNews - The Ministry of Finance has officially extended the validity period of the government-borne (Ditanggung Pemerintah/DTP in Indonesian) Value Added Tax (VAT) incentive by 100% on supplies of landed houses and flats.

The extension is outlined in the Minister of Finance Regulation (MoF Reg.) 61/2024. According to the Ministry of Finance, the facility is granted to increase economic growth through the stimulation of purchasing power in the housing sector.

"To accelerate the increase in economic growth referred to in letter a, it is necessary to provide an additional policy in the form of the government-borne VAT incentives or supplies of landed houses and flat units from September 2024 to December 2024,” reads the considering section of MoF Reg. 61/2024, quoted Thursday (19/9/2024).

Government-borne VAT is granted at 100% of VAT payable of the tax base of up to IDR2 billion with a maximum selling price of IDR5 billion. The facility is provided from the September 2024 taxable period to the December 2024 taxable period.

Similar to the former MoF Reg., the government-borne VAT facility is granted to landed houses or flats with a maximum selling price of IDR5 billion that are new and in a turnkey condition.

A new landed house or a flat unit is one that has obtained a house identity code and is first supplied by the seller taxable person (Pengusaha Kena Pajak/PKP in Indonesia). The house identity code is provided through an application provided by the Ministry of Publik Works and Public Housing (Pekerjaan Umum dan Perumahan Rakyat/PUPR in Indonesian) and/or the People’s Housing Savings Management Agency (Badan Pengelola Tabungan Perumahan Rakyat/BP Tapera in Indonesian).

Individuals entitled to utilise the government-borne VAT facility include Indonesian citizens who have a national identification number (Nomor Induk Kependudukan/NIK in Indonesian) or a Taxpayer Identification Number (TIN or Nomor Pokok Wajib Pajak/NPWP in Indonesian) and foreign nationals who have a TIN insofar as they comply with statutory laws and regulations stipulating home ownership for foreign nationals.

Please note that landed houses or flats that have received the VAT facilities under the former MoF Reg. cannot utilise the government-borne VAT incentive under MoF Reg. 61/2024. (SAP)