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Govt to issue OTT regulation after Google's tax problem is resolved
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Communications and Information Minister Rudiantara. (JP/Viriya P. Singgih)
The government will issue a ministerial regulation on over-the-top (OTT) content providers after the Google tax saga ends.
Communications and Information Minister Rudiantara said on Thursday that the internet giant was still discussing their tax issue with the Finance Ministry and the results of the discussion would become a reference for the regulation’s final draft.
"After the problem with Google is done, we will issue the regulation," Rudiantara said.
(Read also: Indonesia demands documents from Google in tax investigation)
The regulation will rule for a level playing field between foreign and domestic OTT content providers, through a legal basis, which includes aspects on taxation.
Rudiantara said although the regulation would be issued by his ministry, the articles related to taxation would be discussed with the Finance Ministry.
He hoped the Google tax saga could be resolved by mid-year. "We are always supportive of the Finance Ministry, but it [resolving the Google case] should not take too long," he added.
Regarding calculations made by the Directorate General of Taxation, Google has to pay US$400 million in tax arrears including penalties for its five years of operation in the country.
The directorate’s special tax head, Muhammad Haniv, said the company had lobbied the government to not include penalties. The bill was reduced to $73 million but Google tried to lobby the government again in late December last year.
Finance Minister Sri Mulyani Indrawati previously said the government would continue negotiations with Google at the beginning of 2017. (bbn)
