On 21 January 2019, the Head of Investment Coordinating Board of the Republic of Indonesia issued a new regulation, i.e., Regulation of Investment Coordinating Board Number 1 of 2019 concerning Details of Business Fields and Types of Production of Pioneer Industry Eligible for the Corporate Income Tax Reduction Facility as well as Guidelines and Procedures for the Granting of Corporate Income Tax Reductions (Rincian Bidang Usaha dan Jenis Produksi Industri Pionir yang Dapat Diberikan Fasilitas Pengurangan Pajak Penghasilan Badan serta Pedoman dan Tata Cara Pemberian Fasilitas Pengurangan Pajak Penghasilan Badan) (“BKPM Regulation 1/2019”). This regulation serves as implementing regulation of the Regulation of the Minister of Finance Number 150/PMK.010/2018 concerning Provision of Corporate Income Tax Reduction Facility (Pemberian Fasilitas Pengurangan Pajak Penghasilan Badan) (“RMF 150/2018”) which was issued on 26 November 2018. BKPM Regulation 1/2019 also serves to replace the previous regulation of the same title under Regulation of the Investment Coordinating Board Number 5 of 2018 (“BKPM Regulation 5/2018”).

RMF 150/2018 provides that any corporate taxpayer which conducts a new investment in a pioneer industry in Indonesia shall be entitled to receive reduction of corporate income tax, which is also known as Tax Holiday. Details of Tax Holiday rate and period as provided in BKPM Regulation 1/2019 are as follows:

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