INDONESIA

 

COUNTRY

INDONESIA

REGION

Southeast Asia

POPULATION

275,122,131 (July 2021 est.)

GENERAL INTRODUCTION

Officially the Republic of Indonesia, is a country in Southeast Asia and Oceania. Indonesia is an archipelago comprising approximately 17,508 islands.
Indonesia has a mixed economy which both the private sector and government play significant roles. The country is the largest economy in Southeast Asia and a member of the G-20 major economies.

WIFI SPEED

Average connection speed (Mbit/s) - 9.9
Median connection speed (Mbit/s)- 3.07

ELECTRICAL OUTLET

For Indonesia there are two associated plug types, C and F. Indonesia operates on a 230V supply voltage and 50Hz.

PER CAPITA GDP

$11,812 (2019 est.)
$11,372 (2018 est.)
$10,936 (2017 est.)

note: data are in 2010 dollars

CLIMATE

Tropical; hot, humid; more moderate in highlands

RESIDENCE-BY-INVESTMENT

Investor Kitas

Investor Kitas (Types 313 and 314) is issued to applicants who are investing in a PT PMA company in Indonesia and need to work for that company. Indonesian Investor KITAS consists of a lot of benefits, with the most profitable ones include the ease of application and the waiver of the work permit fee. If you satisfy all the investment requirements you should not pay a visa fee of 1,200USD per year. In addition, foreign investors do not have to wait long to start working after introducing their initial investments.

Investments

  • Minimum investment 1 billion rupiah in shares invested

The following requirements to obtain an Investor KITAS:

  • The investor should have a minimum of 1 billion rupiah in shares invested.
  • The company’s capital should have a minimum of 10 billion rupiah in capital investment.
  • The company has a minimum of 25% in paid up capital.
  • The sponsor company can start sponsoring Investors once it has obtained a business registration number (NIB) and trading licenses (Ijin Usaha), foreign company investment realization report (LKPM, this report should be conducting every three months), company’s documents, the ID card and tax number of the company’s representative (should be valid).

Key Benefits

  • Waiver of work permit requirement. Without the requirement to apply for a work permit, the foreigner saves USD 1,200.00 on government fees annually
  • Validity of up to 2 years. Foreigners only require renewing their Investor permit once every 2 years. There will be small savings on government costs, but more importantly there will be substantial savings on processing costs by your agent.

The Investor Visa can easily save a foreigner USD 2,000.00 or more per year on government costs and agent fees.

Processing time

  • The full process of getting Investor Kitas Type 313/314 takes around 3-4 weeks

NATURAL RESOURCES

petroleum, tin, natural gas, nickel, timber, bauxite, copper, fertile soils, coal, gold, silver

ETHNIC GROUPS

Javanese 40.1%, Sundanese 15.5%, Malay 3.7%, Batak 3.6%, Madurese 3%, Betawi 2.9%, Minangkabau 2.7%, Buginese 2.7%, Bantenese 2%, Banjarese 1.7%, Balinese 1.7%, Acehnese 1.4%, Dayak 1.4%, Sasak 1.3%, Chinese 1.2%, other 15% (2010 est.)

LANGUAGES

Bahasa Indonesia (official, modified form of Malay), English, Dutch, local dialects (of which the most widely spoken is Javanese)

Note - more than 700 languages are used in Indonesia

RELIGIONS

Muslim 87.2%, Protestant 7%, Roman Catholic 2.9%, Hindu 1.7%, other 0.9% (includes Buddhist and Confucian), unspecified 0.4% (2010 est.)

MEDIAN AGE

total: 31.1 years
male: 30.5 years
female: 31.8 years (2020 est.)

URBANIZATION

urban population: 57.3 % of total population (2021)
rate of urbanization: 1.99% annual rate of change (2020-25 est.)
Total population growth rate v. urban population growth rate, 2000-2030

PHYSICIAN DENSITY

0.43 physicians/1,000 population (2018)

GOVERNMENT TYPE

Presidential republic

UNEMPLOYMENT RATE

3.5.31 % (2018 est.)
5.4 % (2017 est.)

TAXES

Personal Income Tax Rate (highest marginal tax rate) – 30%

Corporate Income Tax Rate (excluding dividend taxes) – For fiscal year 2020/21, a flat CIT rate of 22% applies to net taxable income. For fiscal year 2022 onwards, a flat CIT rate of 20% applies to net taxable income.

A business entity is tax resident when it is established or is domiciled in Indonesia.

Non-tax Resident

A non-tax resident is:

  • Any entity that is not established and has no domicile in Indonesia that carries on business or conducts activities through a PE in Indonesia.
  • Any entity that is not established and has no domicile in Indonesia that receives or earns income from Indonesia without carrying on business or conducting activities through a PE in Indonesia.

A PE is a form of enterprise used by an individual who does not reside in Indonesia for more than 183 days in a 12-months period, or an entity that is not established or domiciled in Indonesia, to carry on business or conduct activities in Indonesia. A PE has the same tax obligations as a tax resident. Therefore, any income generated by a PE in Indonesia is taxable in Indonesia.

Profits or dividends that are transferred to an entity or individual abroad are subject to a 20% withholding tax. The rate can vary depending on the applicable tax treaty (if any).

Special Tax Regimes- Foreign tax relief

Subject to certain limitations (such as DTA provisions), a credit is granted for tax paid or due abroad in connection with income received or accrued abroad. Proof of tax paid in the foreign country must be attached to the tax return to substantiate the tax credit claimed.

For exempted income items, foreign taxes paid will not be allowed as a credit or deduction or refunded for Indonesian tax purposes.

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