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Indonesia lowers VAT exemption on low value imports

  • Jan 5, 2020 | Richard Asquith

Indonesia is to lower the VAT exemption threshold on goods being imported from $75 to $3 per shipment. The measure will come into effect on 1 February 2020.

The measure reflects the growing e-commerce trade by consumers from foreign sellers, and is aimed at levelling the playing field for local online and shop retailers. Such trade has more than doubled to 50 million packages in 2019 compared to 2018. China is the primary source of sellers.

The withdrawal of the VAT and customs exemption reflects similar moves in Australia and New Zealand. The European Union plans to scrap its €22 threshold in 2021.

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VP Global Indirect Tax
Richard Asquith
VP Global Indirect Tax Richard Asquith
Richard Asquith is VP Global Indirect Tax at Avalara, helping businesses understand their compliance obligations as they grow globally. He is part of the European leadership team which this year won International Tax Review's Tax Technology Firm of the Year. Richard qualified as an accountant with KPMG in the UK, and went on to work in Hungary, Russia and France with EY.
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