October 13, 2020 | Other News

Regulation on 50% Income Tax Discount to Be Issued This Week

The government, through the Ministry of Finance, will immediately issue an implementing regulation regarding the relaxation of Article 25 Income Tax discount, from 30% to 50%. "The Article 25 Income Tax discount to 50% requires a Minister of Finance Regulation, and this is being prepared, the harmonization process is being carried out," said the Minister of Finance, Sri Mulyani, in a video conference as reported by detikfinance (10/8).

According to Sri Mulyani, this policy is taken as the Government's response to overcome the economic impact caused by the COVID-19 pandemic. She hopes that the additional corporate income tax discounts will ease the cash flow of companies affected by the COVID-19 pandemic and certainly encourage the acceleration of national economic recovery.

Meanwhile, the budget for granting the Article 25 Income Tax discount will be sourced from the allocation for tax incentives within the National Economic Recovery program, amounting to IDR 14.4 trillion. On the other hand, it was recorded that up to 6 August 2020, the tax incentive program's expenditure has reached only IDR 2.27 trillion or equivalent to 29.6% of the total incentive's value.

Furthermore, according to the Director General of Taxes, Suryo Utomo, the implementation of the corporate income tax discount is valid for the tax period of July 2020. "This facility will take effect from July. Therefore, the payment for August could start by using the 50% discount," Suryo stated via video conference (10/8). The additional discount of Article 25 Income Tax will take effect immediately after the Minister of Finance issues the Regulation. He also indicated that the regulation will be issued in the next one to two days.