Indonesia Value-Added Tax and Import Duty Exemption For Renewable Energy Property

Country / jurisdiction: Indonesia · Year: 2010 · Status: In force · Level: National · Type: Voluntary

The Regulation of 2010 mainly applies to renewable energy, but also to power plants in general.  It stipulates that Import duty exemptions are valid for:

for machinery and capital for renewable energy;

for capital goods required for public electricity supply (on- and off-grid).

Value Added Tax (VAT) exemptions apply to taxable goods imported to develop renewable energy projects, as long as no substitutes are manufactured in Indonesia. Exemptions are valid for 2 years with optional exenstion depending on applicability and feasibility. As of 2016, the exemption is still applicable.

The VAT exemption applies to machinerey (both constructed and dismantled); while tax may still be rasied on spare parts that companies need to use renewable energy for end-product manufacturing.

Official source: http://www.flevin.com/id/lgso/translations/JICA%20Mirror/english/4244_21_PMK.011_2010_e.html