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Jakarta Post

Boost tax revenue from digital economy

  • Rizal Fatkhur Rohman

Jakarta   /   Thu, May 23 2019   /  01:21 am

The digital economy is predicted to be one of the powerhouses of economic growth. The rapid penetration of internet connection, as well as the widespread use of smartphones, drive the rise in the value of transactions. This sector is projected to contribute approximately 10 percent of Indonesia’s gross domestic product (GDP) in 2025. It is also one of the sectors targeted by the tax authority for revenue. However, it raises concerns on how the Taxation Directorate General formulates and implements proper strategies to optimize revenue from the digital economy. It is acknowledged that collecting tax from this sector is not easy considering that the digital economy has specific features that distinguish it with traditional business models. It is marked with the native of transactions that occur globally and the high use of intangible assets in favor of physical assets.While there are doz...