Indonesia to impose taxes on cryptocurrencies from 1 May 

Indonesia to impose taxes on cryptocurrencies from 1 May 

Indonesia plans to impose VAT on cryptocurrency transactions and income tax on capital gains from cryptocurrency investments. The VAT and capital tax are to be 0.1% each and effective from 1 May.

All this amid a surge in interest in trading digital assets, which took place in Southeast Asia’s largest economy during the coronavirus pandemic. 

Analysis by the Commodity Futures Trading Regulatory Agency shows that the number of crypto asset holders has increased to 11 million by the end of 2021. Interestingly, the total value of crypto transactions in commodity futures markets reached 859.4 trillion rupiah ($59.8 billion) in 2021, more than a tenfold increase compared to 2020. 

In Indonesia, trading of cryptocurrency assets is only possible in the form of commodities and cryptocurrencies cannot be used as a form of payment. 

“Cryptocurrency assets will be subject to VAT because they are goods as defined by the Ministry of Commerce. They are not currency,” – Hestu official Yoga Saksama said during a media briefing. “Therefore, we will impose income tax and VAT on them.”

The government is still working on introducing new regulations on these taxes.

The proposed VAT rate on cryptocurrency assets is much lower than the 11% imposed on most services and goods in Indonesia. In contrast, the income tax of 0.1% of the gross transaction value is the same as the tax on shares.

Indonesia enacted a broad tax law that year, which provided the legal basis for enacting taxes on digital assets. This law has the main objective of optimising revenue collection.

Such low taxes would be a haven for Europe and the rest of the world. Together with a trusted law firm, we recorded a video on digital asset taxes in Poland, which you can watch HERE.

If you don’t know too much about cryptocurrencies yet, I invite you to check out our latest Golden Course, where you will find almost 70 lessons discussing cryptocurrencies from the basics and then moving on to charts, different ways to make money in the market and psychology. You can find the course HERE.

If you already know what cryptocurrencies are and are looking for analysis of Bitcoin and other altcoins, suggestions for plays and interesting facts from this world then check out the Golden Keys product by our experienced trader, with an efficiency of 90% HERE.

01/04/2022 Mr.Advice TEAM

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