Tax Brief: Presidential Regulation Number 68 of 2025
As digital transactions continue to evolve in scale and complexity, the government has deemed it necessary to strengthen its tax regulatory framework, particularly in the area of digital transactions. This effort aims to create a level playing field between digital businesses and their conventional counterparts.
While value-added tax (VAT) on digital transactions has previously been governed by Minister of Finance Regulation (Peraturan Menteri Keuangan/PMK) Number 48/PMK.03/2020, as amended by PMK Number 60/PMK.03/2022, the latest development comes in the form of Presidential Regulation Number 68 of 2025 concerning the Tax Collection System for Cross-Border Digital Transactions.
According to its recital, the regulation was issued in response to concerns that many cross-border digital transactions remain untaxed due to limited oversight and gaps in enforcement, preventing optimal tax collection. This regulation also reflects the government’s commitment to improving fairness and legal certainty in establishing a tax collection system tailored to the unique characteristics of cross-border digital transactions.
At the core of the regulation is the creation of a tax collection system for cross-border digital transactions (sistem pemungutan pajak atas transaksi digital luar negeri/SPP-TDLN). This system is designed to strengthen the state’s ability to collect VAT on cross-border digital transactions in an efficient, effective, and accountable manner. It also acknowledges the technical complexity of digital trade, which demands a specialized approach.
Under the regulation, VAT collection responsibilities will be handled by PT Jalin Pembayaran Nusantara, a subsidiary of a state-owned enterprise operating in financial technology and payment systems.
Furthermore, PT Jalin Pembayaran Nusantara will directly appoint potential partners to carry out its mandate and support the implementation of the system.
The government will also provide remuneration to PT Jalin Pembayaran Nusantara for its role in managing the SPP-TDLN. The amount of this remuneration will be determined by the relevant minister or authorized official, based on proposals submitted by PT Jalin Pembayaran Nusantara.
This concludes the tax brief on Presidential Regulation Number 68 of 2025, a nine-article regulation that took effect on June 5, 2025.
Legal References:
- Law of the Republic of Indonesia Number 6 of 1983 concerning General Provisions and Procedures of Taxation, as amended by Law of the Republic of Indonesia Number 7 of 2021 concerning Harmonization of Tax Regulations.
- Law of the Republic of Indonesia Number 8 of 1983 concerning Value Added Tax and Luxury Goods Sales Tax, as amended by Law of the Republic of Indonesia Number 7 of 2021 concerning Harmonization of Tax Regulations.
- Minister of Finance Regulation Number 48/PMK.03/2020 concerning Procedures for Appointing Collectors, Collection, and Payment, and Reporting of Value Added Tax on the Utilization of Intangible Taxable Goods and/or Services From Outside the Customs Area Within the Customs Area Through Electronic System Trading, as amended by Minister of Finance Regulation Number 60/PMK.03/2022.
