As the government develops new rules for Article 22 income tax in e-commerce, potentially requiring marketplaces to act as tax collectors and expecting improvement from the currently low number of compliant traders in the marketplace, it is worth revisiting value-added tax (VAT) on electronic trading systems (Perdagangan Melalui Sistem Elektronik/PMSE).
Previously, PMSE VAT was governed under Minister of Finance (Peraturan Menteri Keuangan/PMK) Regulation Number 48/PMK.03/2020, as amended by PMK No. 60/PMK.03/2022. The PMSE VAT framework outlines how VAT collectors are appointed, VAT is collected, paid, and reported for intangible taxable goods and/or taxable services delivered from outside Indonesia’s customs area to customers inside the country using PMSE.
Under these provisions, VAT applies to the use of intangible taxable goods and/or taxable services supplied from outside customs territory into the country via PMSE. The VAT is to be collected, paid, and reported by PMSE business entities that the Minister of Finance has officially appointed. As of June 2025, the Minister of Finance has designated at least 196 PMSE VAT collectors, including the following:
1. Amazon Web Services Inc.
2. Google Asia Pacific Pte. Ltd.
3. Google Ireland Ltd.
4. Google LLC
5. Netflix International B.V.
6. Spotify AB
7. Facebook Ireland Ltd.
8. Facebook Payments International Ltd.
9. Facebook Technologies International Ltd.
10. Amazon.com Services LLC
11. Audible, Inc.
12. Alexa Internet
13. Audible Ltd.
14. Apple Distribution International Ltd.
15. TikTok Pte. Ltd.
16. The Walt Disney Company (Southeast Asia) Pte. Ltd.
17. LinkedIn Singapore Pte. Ltd.
18. McAfee Ireland Ltd.
19. Microsoft Ireland Operations Ltd.
20. Mojang AB
21. Novi Digital Entertainment Pte. Ltd.
22. PCCW Vuclip (Singapore) Pte. Ltd.
23. Skype Communication SÀRL
24. Twitter Asia Pacific Pte. Ltd.
25. Twitter International Company
26. Zoom Video Communications, Inc.
27. PT Jingdong Indonesia Pertama
28. PT Shopee International Indonesia
29. Alibaba Cloud (Singapore) Pte. Ltd.
30. GitHub, Inc.
31. Microsoft Corporation
32. Microsoft Regional Sales Pte. Ltd.
33. UCWeb Singapore Pte. Ltd.
34. To The New Pte. Ltd.
35. Coda Payments Pte. Ltd.
36. Nexmo Inc.
37. Cleverbridge AG Corporation
38. Hewlett-Packard Enterprise USA
39. Softlayer Dutch Holding B.V. (IBM)
40. PT Bukalapak.com
41. PT Ecart Webportal Indonesia (Lazada)
42. PT Fashion Eservices Indonesia (Zalora)
43. PT Tokopedia
44. PT Global Digital Niaga (Blibli.com)
45. Valve Corporation (Steam)
46. beIN Sport Asia Pte. Limited
47. Etsy Ireland Unlimited Company
48. Proxima Beta Pte. Ltd.
49. Tencent Mobility Limited
50. Tencent Mobile International Limited
51. Snap Group Limited
52. Netflix Pte. Ltd.
53. eBay Marketplace GmbH
54. NordVPN S.A.
55. Amazon.com.ca. Inc.
56. Image Future Investment (HK) Limited
57. Dropbox International Unlimited Company
58. Freepik Company S.L.
59. Epic Games International S.à r.l., Bertrange, Root Branch
60. Expedia Lodging Partner Services Sàrl
61. Hotels.com, L.P.
62. BEX Travel Asia Pte. Ltd.
63. Travelscape, LLC
64. TeamViewer Germany GmbH
65. Scribd, Inc.
66. Nextway Sasu
67. TunnelBear LLC
68. Xsolla (USA), Inc.
69. Paddle.com Market Limited
70. Pluralsight, LLC
71. Automatic Inc.
72. Woocommerce Inc.
73. Bright Market LLC
74. PT Dua Puluh Empat Jam Online
75. PT Fashion Marketplace Indonesia (Zalora)
76. Pipedrive OU
77. Shutterstock, Inc.
78. Shutterstock Ireland Ltd.
79. Fenix International Limited
80. Bold LLC
81. High Morale Developments Limited
82. Aceville Pte Ltd.
83. WeTransfer B.V.
84. OffGamers Global Pte Ltd.
85. Chegg Inc.
86. NBA Properties Inc.
87. Activision Blizzard International B.V.
88. Economist Digital Services Limited
89. Booking.com B.V.
90. EA Swiss Sarl
91. Native Instruments GmbH
92. Upcloud Limited
93. Mega Limited
94. Airbnb Ireland Unlimited Company
95. Udemy Inc.
96. Vonage Business Inc.
97. Blizzard Entertainment Inc.
98. Twitch Interactive Singapore Pvt. Ltd
99. Canva Pty Ltd.
100. New York Times Digital LLC
101. Degreed Inc.
102. Home Box Office (Singapore) Pte. Ltd.
103. LNRS Data Services Limited
104. LexisNexis Risk Solution FL Inc.
105. Ask FM Europe Limited
106. Iqiyi International Singapore Pte. Ltd.
107. Global Cloud Infrastructure Limited
108. John Wiley & Cons, Inc.
109. Springer Nature Customer Service Center GmbH
110. Springer Nature Limited
111. Paypro Europe Limited
112. BioMed Central Limited
113. Unity Technologies ApS
114. Coursera, Inc.
115. Groundhog Inc.
116. Groundhog Technologies Inc.
117. Surfshark B.V.
118. To The New Singapore Pte. Ltd.
119. Ezviz International Limited
120. Zendrive Inc.
121. University of London
122. CVmaker B.V.
124. Asana, Inc.
125. Patreon, Inc.
126. Change Organization
127. PT Ocommerce Capital Indonesia
128. ESET, spol. s r. o.
129. CGTrader UAB
130. Waves, Inc.
131. Tradingview, Inc.
132. Match Group, LLC
133. Hewlett-Packard International Sarl
134. Adobe Systems Software Ireland Limited
135. Coupa Software, Inc.
136. NBA Digital Services International, Inc.
137. Alpha Lit, Pte. Ltd.
138. Wondershare Global Limited
139. Asiaplay Taiwan Digital Entertainment Ltd.
140. Taxamo Checkout Ltd.
141. Amplitude, Inc.
142. Unity Technologies SF.
143. Epic Games Entertainment International GmbH
144. Epic Games Entertainment International GmbH
145. Amazon Advertising LLC.
146. Amazon Service Europe S.à r.l.
147. UpToDate, Inc.
148. Cambridge University Press & Assessment UK
149. Prezi, Inc.
150. Agoda Company Pte. Ltd.
151. Tencent Music Entertainment Hong Kong
152. Supercell Oy
153. WPEngine, Inc.
154. Garmin (Europe) Limited
155. Hotjar Limited
156. DigitalOcean, LLC.
157. Corel Corporation
158. Foxit Software Incorporated
159. Sendinblue SAS
160. Twitch Interactive Singapore Private Limited
161. NCS Pearson, Inc.
162. Salesforce.com Singapore Pte. Ltd.
163. Grammarly, Inc.
164. DeepL SE
165. Squarespace Ireland Ltd.
166. Trendstream Ltd.
167. Aptoide, S.A.
168. NortonLifeLock Singapore Pte. Ltd.
168. Sandbox Interactive GmbH
169. Zwift, Inc.
170. Tencent Cloud International Pte. Ltd.
171. Blacklane GmbH
172. Social Online Payments Limited
173. Final Impian Niaga
174. Niantic International Ltd.
175. Elsevier B.V.
176. The World University Insights Limited
177. Cloudkeeper (Singapore) PTE. LTD.
178. FM Priv LLC.
179. Midjourney, Inc.
180. Arc Games Inc.
181. DEEZER
182. Rebecca Hall
183. YOUZU GAMES HONG KONG LIMITED
184. ARENANET, LLC.
185. NERIS Analytics Limited
186. Circle Internet Services, Inc.
187. Vimeo.com, Inc.
188. TP Global Operations Limited
189. Lumen Research Limited
190. Amazon Japan G.K.
191. Vorwerk International & Co. KmG.
192. Huawei Service (Hong Kong) Co. Limited
193. Sounds True Inc.
194. Siteground Hosting Ltd.
195. BrowserStack Inc.
196. Total Security Limited
The regulation appoints selected digital platforms, service providers, and digital businesses, both domestic and foreign, as PMSE VAT collectors. These companies are responsible for charging, collecting, and remitting 11% VAT on digital transactions, including software sales, video/audio streaming subscriptions, and cloud computing services.
To qualify, businesses must meet specific criteria, such as transactions exceeding IDR 600 million per year, or having at least 12,000 users accessing the service from Indonesia annually. This is in line with the PMK Number 48/PMK.03/2020, as amended by PMK Number 81 of 2024 concerning Tax Provisions within the Coretax Administration System, and Director General of Taxes Regulation Number PER-12/PJ/2020 concerning Limitation of Specific Criteria for Collectors and Appointment of Collectors, Collection, Payment, and Reporting of Value-Added Tax on the Utilization of Intangible Taxable Goods and/or Taxable Services from Outside the Customs Area Within the Customs Area Through Electronic Trading Systems.
Since the regulation’s rollout, tax revenues from PMSE VAT have grown steadily. According to the Ministry of Finance, by early 2025, designated PMSE VAT collectors had collected IDR 26.18 trillion as detailed below:
Regarding the collection and reporting mechanism, PMK number 48/PMK.03/2020, as amended by PMK number 60/PMK.03/2022, stipulates that appointed digital businesses must charge VAT at the point of sale, remit the collected tax to the state treasury by the end of each month, and issue invoices or billing statements that clearly separate the VAT component.
Despite its success, the PMSE VAT scheme faces challenges in tax compliance among foreign businesses that lie outside Indonesia’s jurisdiction. The fast-paced evolution of digital business models also adds complexity to monitoring and enforcement.
Still, Indonesia is not alone. Countries in the OECD and EU, for instance, have long implemented VAT rules for cross-border digital services. The European Union requires VAT on all digital goods sold to EU consumers, regardless of the supplier’s location.
Australia’s “Netflix Tax,” in effect since 2017, imposes a 10% goods and services tax (GST) on cross-border digital services, while New Zealand has enforced similar rules since 2016, with minimum turnover thresholds for foreign digital providers.
Indonesia continues to actively engage in international tax forums, including the OECD Inclusive Framework and the ASEAN Forum on Taxation. These efforts aim to build global standards for digital taxation and improve cross-border cooperation and information exchange.
The imposition of PMSE VAT has a double impact. On the one hand, its introduction has helped level the playing field for domestic digital businesses that had long competed with untaxed foreign players. However, consumers may feel the impact through higher subscription costs and digital service prices due to the additional tax.
To strengthen oversight, the Directorate General of Taxes is enhancing its monitoring systems by collaborating with payment service providers and using digital analytics. One of its significant strategies is integrating data across agencies to trace cross-border digital transactions more effectively.
The government is looking forward to exploring the expansion of PMSE VAT to include digital financial services and user-generated content, in response to the rapid growth and diversification of the digital economy.
PMSE VAT reflects Indonesia’s proactive stance in adapting its tax system to a fast-changing digital world. Backed by a solid regulatory foundation, this policy not only supports fiscal sustainability but also sends a strong signal across Southeast Asia that digital commerce should be taxed fairly, whether delivered locally or from abroad.
Legal References
- 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, Payment, and Reporting of Value-Added Tax on the Utilization of Intangible Taxable Goods and/or Taxable Services from Outside the Customs Area Within the Customs Area Through Electronic Trading Systems, as amended by Minister of Finance Regulation Number 81 of 2024 concerning Tax Provisions within the Coretax Administration System.
- Director General of Taxes Regulation Number PER-12/PJ/2020 concerning the Limitation of Specific Criteria for Collectors and Appointment of Collectors, Collection, Payment, and Reporting of Value-Added Tax on the Utilization of Intangible Taxable Goods and/or Taxable Services from Outside the Customs Area Within the Customs Area Through Electronic Trading Systems.
