Indonesia imposes 10% VAT on tech companies

In a statement on Friday, Southeast Asia’s biggest country Indonesia said, it has added, Facebook, TikTok, Disney, Amazon, Netflix, Spotify, and Google to the list of tech companies which will have to pay a 10% value-added tax on their sales in the country.

With a population of around 270 million, Indonesia is a big market for these companies.

Friday’s announcement adds, Amazon’s subsidiaries, including its audiobook unit Audible to the list of companies which will have to pay the additional Vat amount.

The companies did not not immediately respond to requests to comment.

Under its current rules, non-resident foreign firms which sell digital products and services in the country with a sales threshold of at least $41,039.67 (600 million rupiah) a year or which generate yearly traffic from at least 12,000 users, will be required to pay the 10% VAT.

Indonesia expects a record 13% drop in annual state revenue in 2020 due to the Wuhan coronavirus induced disruption in business activities.

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