President Joko Widodo’s administration has been particularly aggressive about chasing up tax money recently. In addition to the controversial tax amnesty program, the government has also been trying to collect tax from global internet and social media giants like Google and Facebook for any revenue they have made from selling advertising in Indonesia.
But soon, the government might start taxing individual internet and social media users for their online business as well, a law that could hit social media celebrities with lucrative endorsement deals particularly hard.
The Directorate General of Taxation announced that they are planning to pass into law a policy that requires anyone who carries out online transactions to pay tax to the government.
“Online marketplaces, daily deals, direct sales, and all endorsers will be subject to tax, and if they receive income it must be reported,” said Yon Arsal, director at the Finance Ministry’s Tax Reception department, as quoted by Kompas today.
Under this policy, not only would Instagram celebrities who are paid to endorse products be taxed, anyone conducting sales through third party services like Kaskus would also have to give the government their share.
Yon added that the government could potentially earn around Rp 15.6 trillion from taxing personal online transactions.
However, the Finance Ministry is still figuring out an effective way to enforce this tax policy. They said they could potentially work with the IT Ministry in order to monitor online transactions in Indonesia.
