ANNOUNCEMENT 14 Aug 2018
On 14 August 2018, the Indonesian government announced to the media planned tariff increases on consumer goods.
NUMBER OF INTERVENTIONS
Ministry of Finance regulation 110/PMK.010/2018 (in Bahasa Indonesia)
Secondary Sources (in English)
On 14 August 2018, the Indonesian Minister of Finance announced in a press conference that the government will increase tariffs on over 500 consumer goods to 7.5%, in order to reduce imports and improve the country's current account. Since that announcement, the Finance and Trade ministries have made multiple announcements confirming the government's plans (see sources).
Furthermore, since the initial statement, the planned number of goods affected by tariffs has increased from 500 to 900 and some tariff rates shall be increased to 10 and not 7.5%. The list of products is expected to be made public in September 2018.
The Finance Minister was also cited that the affected products would primarily be consumer goods and not raw materials, with a focus on goods that can be substituted by domestic ones.
On 5 September 2018, the Indonesian Ministry of Finance issued regulation 110/PMK.010/2018 updating its list of imported products subject to the "PPh22" income tax (see related state acts).
In the end, the regulation increased the tax from 2.5 to 7.5% for 721 goods (or 323 products at the 6-digit HS code level), from 2.5 to 10% for 218 goods (62), and from 7.5 to 10% for 209 goods (17).
It came into force on 13 September 2018.
Regulation 110/PMK.010/2018 by the Ministry of Finance also removed two products (6103.29.00 and 7013.42.00) from the list of imported goods that were previously subject to a 7.5% "PPh22" income tax. Instead, the two goods will face the usual tax of 2.5%.
The regulation came into force on 13 September 2018.