Starting on May 1st, Indonesia has plans to charge a value-added tax (VAT) on crypto transactions and capital gains taxes on income. The VAT rate is currently below 11% on most Indonesian goods and services, and capital gains are expected to be 0.1%, which is also the capital gains VAT rate from company shares.
According to an Indonesian tax official, Hestu Saksama, the government is expected to impose an income tax and VAT on crypto assets, and is in the works of implementing the regulation. “Crypto will be subject to a VAT because they are currently defined as a commodity and not a currency according to the trade ministry.”
Cryptocurrency trading in Indonesia is currently regulated by the Commodity Futures Trading Regulatory Agency since they are not yet allowed to use them as a means of currency. There is an estimated 11m Indonesians who had invested in cryptocurrency as per estimates from the end of 2021.
According to officials, the tax law infrastructure was aimed at optimizing the revenue collection to deal with the aftermath of the Covid-19 pandemic.