Voluntary Amnesty Tax (VAT)

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Voluntary Amnesty Tax (VAT)

January 6, 2022

The Voluntary Amnesty Tax, abbreviated as VAT, is an initiative that provides taxpayers with the opportunity to voluntarily report or disclose their outstanding tax obligations through the payment of Income Tax (PPh) based on asset disclosures. The program aims to enhance voluntary taxpayer compliance and is implemented based on the principles of simplicity, legal certainty, and benefit.

The Voluntary Amnesty Tax consists of two policies that were in effect from January 1 to June 30, 2022.

Policy I	Policy II
Final income tax payment based on the disclosure of assets that were not or not fully reported by participants of the Tax Amnesty program.	Final income tax payment based on the disclosure of assets that were not reported in the 2020 Annual Individual Income Tax Return.
Participants Individual and corporate taxpayers who participated in the Tax Amnesty (TA) program.	Participants Individual taxpayers
Disclosure Basis Assets as of December 31, 2015 that were not disclosed during participation in the TA program.	Disclosure Basis Assets acquired between 2016–2020 that were not reported in the 2020 Annual Tax Return.
Tax Rates 11% for offshore declared assets; 8% for repatriated offshore assets and domestic assets.; 6% for repatriated offshore assets and domestic assets invested in government securities, downstream industry, or renewable energy.	Tax Rates 18% for offshore declared assets; 14% for repatriated offshore assets and domestic assets; 12% for repatriated offshore assets and domestic assets invested in government securities, downstream industry, or renewable energy.

Policy I

Policy II

Final income tax payment based on the disclosure of assets that were not or not fully reported by participants of the Tax Amnesty program.

Final income tax payment based on the disclosure of assets that were not reported in the 2020 Annual Individual Income Tax Return.

Participants

Individual and corporate taxpayers who participated in the Tax Amnesty (TA) program.

Participants

Individual taxpayers

Disclosure Basis

Assets as of December 31, 2015 that were not disclosed during participation in the TA program.

Disclosure Basis

Assets acquired between 2016–2020 that were not reported in the 2020 Annual Tax Return.

Tax Rates

11% for offshore declared assets;
8% for repatriated offshore assets and domestic assets.;
6% for repatriated offshore assets and domestic assets invested in government securities, downstream industry, or renewable energy.

Tax Rates

18% for offshore declared assets;
14% for repatriated offshore assets and domestic assets;
12% for repatriated offshore assets and domestic assets invested in government securities, downstream industry, or renewable energy.

Benefits of Voluntary Amnesty Tax (VAT)
Exemption from sanctions under Article 18 (3) of the Tax Amnesty Law.	No tax assessments will be issued for tax obligations in 2016–2020, unless there is a finding of underreported assets (including Individual Income Tax, Withholding Tax, and VAT, except for taxes that were withheld/collected but not remitted)
Data Protection Data and information originating from the Asset Disclosure Letter (SPPH) and its attachments, administered by the Ministry of Finance or any related party in implementing the Harmonized Tax Law (UU HPP), cannot be used as the basis for investigation, prosecution, or criminal charges against the taxpayer.	Data Protection Data or information originating from the SPPH and its attachments, as administered by the Ministry of Finance or other parties in connection with the implementation of the HPP Law, cannot be used as the basis for investigation, inquiry, and/or criminal prosecution against the taxpayer.

Benefits of Voluntary Amnesty Tax (VAT)

Exemption from sanctions under Article 18 (3) of the Tax Amnesty Law.

No tax assessments will be issued for tax obligations in 2016–2020, unless there is a finding of underreported assets (including Individual Income Tax, Withholding Tax, and VAT, except for taxes that were withheld/collected but not remitted)

Data Protection

Data and information originating from the Asset Disclosure Letter (SPPH) and its attachments, administered by the Ministry of Finance or any related party in implementing the Harmonized Tax Law (UU HPP), cannot be used as the basis for investigation, prosecution, or criminal charges against the taxpayer.

Data Protection

Data or information originating from the SPPH and its attachments, as administered by the Ministry of Finance or other parties in connection with the implementation of the HPP Law, cannot be used as the basis for investigation, inquiry, and/or criminal prosecution against the taxpayer.

*Disclaimer: This article is for general information only and does not constitute legal advice. We accept no liability for any consequences arising from its use. Unauthorized use or reproduction is prohibited and may result in legal action.

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