“There is a plan to release a special economic package on e-commerce," said Indonesian E-commerce Association (idEA) chairman Daniel Tumiwa on the sidelines of an open house event at Communications and Information Minister Rudiantara's official residence in Jakarta on Wednesday.

"So, SMEs [small and medium-sized enterprises] that run their businesses online will be charged a small percentage of tax by the government."

He acknowledged that the association had recently met with the Taxation Directorate General.

Daniel said the tax rate to be charged was "reasonable", smaller than the rate currently charged on offline SMEs. He, however, declined to provide details on the rate.

Back in 2013, the Finance Ministry issued a regulation that set 1 percent in income tax on individual and institutional taxpayers with annual business turnovers of up to Rp 4.8 billion (US$364,409).

However, the government has found it difficult to charge small online players, most of whom don’t have legal entities or taxpayer identification numbers (NPWP).

With the upcoming regulation, people owning online shops, including on Instagram or Facebook, must report their incomes and pay taxes, Daniel said.

The announcement will most likely occur after the first phase of the tax amnesty policy implementation in September. (vps) (tas)

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