The Tax Office has been chasing after Google for the last several months, arguing that the Internet giant owes the country massive amounts in back taxes on revenue generated from Indonesia. Their attempts at pressuring the company appear to have paid off as Google is now expected to reach a tax settlement with the Indonesian government within the next few weeks.
Getting Google to pay up seems to have emboldened the tax office, which announced yesterday that the next major target in its tax crusade against foreign Over-The-Top (OTT) online service providers would be social network king Facebook.
The Directorate General of Taxation, Muhammad Hanif, said the government would charge Facebook for its fair tax liability on profits made in Indonesia even though the company does not have an office in the country (although Facebook actually does in fact have a representative office here).
“We will invite Facebook to come from Ireland,” Hanif said at Hotel Borobudur in Jakarta yesterday, as quoted by Tempo (Facebook’s international business headquarters is in Ireland). He also mentioned that Facebook had not responded to previous requests sent by his office.
Hanif did not say exactly how much Facebook owed the government, but he did say the company had earned about USD 160 million in Indonesia. He also noted that Facebook had tax liabilities here because the company maintained servers in Indonesia.
Besides Facebook, Hanif said the Tax Directorate was eyeing other OTT companies such as Apple, Twitter, and Yahoo!.
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