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Jakarta Post

Should Indonesia adopt digital services tax?

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Jakarta   /   Thu, June 13, 2019   /  10:56 am
Should Indonesia adopt digital services tax? Illustration of digital business (Shutterstock.com/fatmawati achmad zaenuri)

Technological advances have brought more cross-border transactions than ever. With digital technology, it is easier and cheaper for sellers to reach the global market. At the same time, it also brings more convenience to buyers as they may access a greater variety of products at lower prices. Despite the opportunities for sellers and buyers, digitalization also brings about challenges to the tax system. The digital platform and internet technology have enabled businesses to operate and generate huge revenues in a particular country without having to establish a significant physical presence. This has created a growing global tax concern because it may erode the tax base and reduce tax revenues. For example, the presence of foreign digital business operations in a market jurisdiction may reduce the market share and profit of traditional businesses that previously comprised the tax b...

Disclaimer: The opinions expressed in this article are those of the author and do not reflect the official stance of The Jakarta Post.