Crypto Market in Indonesia Subject to VAT – Investing in cryptocurrencies or crypto assets is increasingly popular all over the world, including Indonesia. Crypto assets have great potential for startup growth. Crypto assets are increasingly in demand because of their convenience and the potential for high returns that attract investors. But did you know that cryptocurrency investments in Indonesia are already taxed.

Below, we present information related to tax rates for the Crypto Market in Indonesia.

What is Crypto Assets?

Quote from the Investopedia page www.investopedia.com. A cryptocurrency is a digital or virtual currency that is secured by cryptography, which makes it nearly impossible to counterfeit or double-spend. Many cryptocurrencies are decentralized networks based on blockchain technology—a distributed ledger enforced by a disparate network of computers. A defining feature of cryptocurrencies is that they are generally not issued by any central authority, rendering them theoretically immune to government interference or manipulation.

Who is Crypto Taxed or Crypto Tax Subject?

Based on Article 19 of the Regulation of the Minister of Finance (PMK) No. 68 of 2022, crypto tax subjects or those subject to crypto income tax or income tax are:

1. Crypto asset seller;
2. PMSE Operator;
3. Crypto Asset Miner.

Meanwhile, crypto VAT subjects or those subject to VAT on crypto asset transactions are:

1. Crypto asset buyers
2. Crypto asset seller

How Much the Tax Rate for Crypto Asset Transactions

Official crypto asset transactions are subject to value added tax (PPN) and income tax (PPN) based on Minister of Finance Regulation (PMK) Number 68 of 2022. Here are the rates:

1. 0.11% : VAT rate on crypto asset trading
The VAT rate on crypto asset trading is 0.11% of the transaction value in the event that the trade operator is a Physical Asset Trader (PFAK).

2. 0.22% : VAT rate on trading crypto assets
The VAT rate on crypto asset trading is 0.22% of the value of this transaction in the case of a non-PFAK trade organizer.

3. 1.1% : VAT rate on mining services
The VAT rate on mining services is 1.1% of the conversion value of crypto assets and mining services already have asset transaction verification.

4. 0.1% : Final Article 22 Income Tax Rate on crypto asset trading earnings
Article 22 PPh rate on crypto asset trading of 0.1% of the crypto asset value (if it is a PFAK) is imposed on sellers of crypto asset trades.

5. 0.2% : Final Article 22 Income Tax Rate on crypto asset trading earnings
Article 22 income tax bill for mining crypto assets is 0.2% of the value of crypto assets (if not PFAK).

6. 0.1% : Final Article 22 Income Tax Rate on crypto asset mining earnings
Article 22 Final PPh rate on crypto asset mining income is 0.1% of the income received or earned by crypto asset miners (miners), excluding VAT.

Crypto VAT Rates with Certain Amounts

Referring to Article 16 paragraph (1) PMK 68/2022, VAT on the delivery of crypto asset transaction verification services and/or mining pool management services by crypto asset miners as PKP, VAT collected and deposited at a certain amount.

A certain amount of VAT on the delivery of crypto asset transaction verification services and/or crypto asset miner group management services by crypto asset miners is 10% of the VAT rate multiplied by the monetary value of crypto assets received by crypto asset miners, including crypto assets received from crypto asset system (block reward).

Currency Provisions in Crypto Taxes in Indonesia

Based on Article 17 paragraph (3) of the Regulation of the Minister of Finance (PMK) No 68 of 2022, in terms of the rewards received by crypto asset miners for the delivery of crypto assets in connection with transaction verification services and/or mining pool management services in the form of:

1. Fiat currency other than rupiah currency, the fiat currency is converted into rupiah currency based on the exchange rate determined by the Minister of Finance (Tax Rate or Exchange Rate of the Ministry of Finance).
2. The crypto assets are converted into rupiah currency based on:
   > A value set by a futures exchange that trades crypto assets, or
   > Based on the value in the system owned by miners of crypto assets, which is set consistently.

List of Crypto Assets that are Legal in Indonesia that Can be Traded

Can Crypto Assets be Used as a Means of Payment in Indonesia?

In Indonesia, cryptocurrencies are treated only as tradable assets or commodities (crypto assets), not as a means of payment. The provisions in Law Number 7 of 2011 concerning Currencies state that currency issued by the Unitary State of the Republic of Indonesia to be used in every transaction that has the purpose of payment, or other obligations that must be fulfilled with money, or other financial transactions carried out in the territory of the Republic of Indonesia. The Unitary State of the Republic of Indonesia is required to use Rupiah.

And also based on the regulations that have been set, cryptocurrency cannot be used as a means of payment in Indonesia but can still be traded in Indonesia and can only be used as a commodity based on the Regulation of the Commodity Futures Trading Supervisory Agency (Bappebti) No. 5 of 2019 concerning Technical Provisions for the Implementation of the Physical Crypto Asset Market.

In addition, based on Bank Indonesia Regulation Number 11/12/PBI/2009 concerning Electronic Money, states that electronic money can be used as a means of payment if it fulfills the conditions that are circulated based on the amount of money deposited in rupiah, but cryptocurrency itself is generated or produced through a mining system and therefore cannot qualify as a means of payment.

Conclusion

Thus the information about crypto market in Indonesia Subject to VAT that you need to understand. If you have difficulty managing crypto taxes, both Crypto VAT and crypto PPh, Contact Indoservice.

Indoservice offers tax outsourcing services based in Indonesia. At Indoservice, we have a dedicated team of professionals who will assist you in dealing with taxation. You can count on us to provide the quality of service that best suits your needs.

Contact at email: admin@indoservice.co.id or Telp./Whatsapp at +62877-1449-8500 to consult with us regarding Taxes.

Source :
> https://klikpajak.id/blog/pajak-cryptocurrency/#Bagaimana_Pengenaan_Pajak_Cryptocurrency
> https://pajak.go.id/id/artikel/cryptocurrency-sebagai-aset-investasi-dan-perlakuan-perpajakannya