Motor vehicle taxes in Indonesia

This article concerns the taxes on motor vehicles in Indonesia, on import, purchase, resale and ownership.

PPnBM

One key form of motor vehicle tax is on the purchase of brand new motor vehicles, called PPnBM (pajak penjualan atas barang mewah — sales tax on luxury goods). This is not to be confused with PPN (pajak pertambahan nilai — value added tax).

PPnBM covers a variety of luxury and not-so-luxury goods including certain new houses, helicopters, etc.

The PPnBM for motor vehicles is set by PP 73/2019 as modified by PP 74/2021, from 16 October 2021, which altered many of the tax categories, as formally laid out in PMK 141/2021

PPnBM is charged at the time of import based on the import value for imported vehicles, and at the time of sale for vehicles assembled in Indonesia.

Motorcycles etc.

• Motorcycles up to 250cc inclusive: 0%
• Motorcycles 250.01cc — 500cc: 60%, as well as dune buggies and similar
• Motorcycles 500.01cc+, as well as unpowered caravans and trailers: 95% -> (reduced from 125% in October 2021)
• Golf carts: 50%

Cars/MPVs/minibuses up to 9 people

2017–15 October 2021

• up to 1.5l — 10% if not 4WD nor sedan nor station wagon. 30% otherwise.
• 1.5l-2.5l — 20% if not 4WD, nor sedan nor station wagon, 40% otherwise.
• 2.5l-3l petrol: 40%
• 3l+ petrol, or 2.5l+ diesel: 125%

From 16 October 2021

Based on CO2, but with a further penalty for large engines.

CO2/km  <=3l 3l-4l >4l+ 
0–149g  15%  40%   95% 
150–199 20%  50%   95%
200–249 25%  60%   95%
250+    40%  70%   95%

Vehicles of 10–15 people :

2017–October 2021 — any capacity: 10%

From 16 October 2021

CO2/km  <=3l 3l-4l >4l+ 
0–199g  15%  25%   95% 
200+    20%  30%   95%

Double cabin pickup trucks

2017–15 October 2021 system: For 4–6 people, up to 5 tonnes, any capacity: 20%

From 16 October 2021

Based on CO2, but with a penalty for large engines.

CO2/km  <=3l 3l-4l >4l+ 
0–149g  10%  20%   95% 
150–199 12%  25%   95%
200+    15%  30%   95%

Zero-rated vehicle types:

• Vehicles for 16+ people
• Motorcycles up to 250cc
• Vehicle chassis (with engine, transmission and steering)
• Vehicles in ‘knocked down’ state
• Goods vehicles

Reduced tax bases for certain vehicle types

For certain vehicles, the PPnBM is calculated based on a reduced % of the purchase price, resulting in lower effective tax rates:

LCGCs

LCGCs (low cost green cars, defined as a petrol car up to 1.2l with CO2 <120g/KM, or a diesel car up to 1.5l with <120g/KM) used to have the tax basis reduced to zero, however from October 2021 the rate was 3% (though discounted to zero through covid incentives)/

List of current LCGCs (all petrol, there are no diesel options):

• Toyota Calya/Daihatsu Sigra 1.0/1.2
• Toyota Agya/Daihatsu Ayla 1.0/1.2
• Honda Brio Satya (1.2)
• Suzuki Karimun Wagon R (1.0)

Reductions for hybrid, electric and alternative fuel cars

An effective tax rate of 5% applies to plug-in hybrids with CO2 < 100g/KM.

The following tax rates apply for full/mild hybrids with engines up to 3l diesel or petrol.

• CO2 < 100g/km= 6% / 8%
• CO2 100–124g/km = 7% / 9%
• CO2 125–150g/km = 8% / 12%

And with engines 3l-4l full or mild hybrid:

• CO2 < 100g/km= 20%
• CO2 100–124g/km = 25%
• CO2 125–150g/km = 30%

‘Flexy engines’ capable of using Bio Fuel 100 are 8%.

Exemptions

The following are exempt based on usage:

• government, army, etc. vehicles
• ambulances, hearses
• public transport
• fire trucks

If the use is changed to a non-exempt use within four years, then the PPnBM must be paid.

2021 PPnBM incentives ‘due to covid’

PMK 20/2021, PMK 31/2021 as extended by PMK 77/2021 and PMK 120/2021 applied for vehicles with at least 60% local components, from March through December 2021. (Ended from 2022)

• all vehicles up to 1.5l — 100% reduction
• 1.5l-2.5l 2WD vehicles other than sedan/station wagon — 50% reduction
• 1.5l-2.5l 4WD vehicles other than sedan/station wagon — 25% reduction

Tax implications of the PPnBM system

The tax system has been extremely hostile to sedans and station wagons, which are therefore virtually non-existent in the Indonesian market. From October 2021 this was removed, and these cars may increase in popularity.

The tax system creates these market segments.

For motorcycles:

• anything up to 250cc, assembled in Indonesia @ 0%
• anything else @ forget about it

From October 2021, the key segments are:

• 1/1.2l city cars 3%
• double cabin pick-ups with up to 3l engines — 15% (these trucks are extremely inefficient, and there would be little point in trying to reduce CO2 emissions below 200g/km to take advantage of the 10% and 12% tax rates)
• efficient cars up to 149g/km CO2 (this excludes most vehicles currently popular in Indonesia) — 15%
• cars 150–199g/km — 20% this includes many vehicles previously taxed at 10%
• cars 200–249g/km up to 3l — 25% this includes most vehicles currently taxed at 20%, and is extremely inefficient by global standards, including SUVs such as the Toyota Fortuner 2.7 petrol automatic. 4WD and diesel vehicles of 2.5–3l will enjoy a substantial tax cut

Article 22 Income Tax on Importers of Vehicles

PPh Pasal 22 of 10% based on PMK 110/2018 is charged to the importers of complete cars, whether they have an API or not. However for those who have an API and who are importing completely knocked down vehicles, or car parts, the rate is only 2.5%.

Import Duty (Bea Masuk) on vehicles

Import duty (BM) is set via PMK 6/2017, as modified several times. There are numerous types, but essentially individual car parts are taxed at 0%, 2.5%, 5%, 7% or 10%, while completely knocked down motor vehicles are taxed at 10%, and complete motorcycles are taxed at 30% or 40%, while complete cars are generally taxed at 50%. It is important to note that all other taxes are calculated gross of BM, so there is a ratcheting effect for importers of complete vehicles. Therefore imported vehicles are to be avoided.

Article 22 Income Tax on Super-Luxury Goods sales

PPh Pasal 22 Super-Luxury Goods Income tax of 5% (calculated before PPN and point-of-sale PPnBM) based on PMK 92/2019, is charged to purchasers of:

• sedans, SUVs, MPVs, minibuses, and the like, with capacity of over 3l, or sale price over 2 billion rupiah
• 2/3-wheeled vehicles with selling price over 300 million rupiah or over 250cc.

PPN (VAT)

10% VAT is charged on imports and sales. Input VAT is reclaimable so essentially it is 10% of the retail price (before local taxes)

Police fees

The STNK or surat tanda nomor kendaraan or vehicle registration certificate carries a fee payable to the police per PP 76/2020 of 100,000rp every 5 years for motorcycles, 200,000rp for 4-wheeled vehicles.

SWDKLJJ or Santunan dan Sumbangan Wajib Dana Kecelakaan Lalu Lintas Jalan is a form of road insurance. The tariff is payable at the same time as the STNK with the rates set out in PMK 16/2017:

• motorcycles to 50cc 0
• motorcycles 51–250cc: 32,000rp
• motorcycles 251cc+: 80,000rp
• Tow truck: 20,000rp
• Pickup/goods vehicle to 2.4l, plus other cars etc.: 140,000rp
• Goods vehicles over 2.4l: 160,000rp
• Public transport to 1.6l: 70,000rp
• Public transport over 1.6l: 87,000rp
• Bus and minibus other than public transport: 150,000rp

There is a fine payable for late payment of SWDKLLJ of 25% to 100%, not to exceed 100,000rp.

The money payable is payable to road traffic victims other than those in the vehicle that caused the accident, except per PP 18/1965:

• if drunk
• committing a crime
• racing

The compensation is:

• 50 million compensation for death, proportional reduction for disabilities
• Medical fees up to 20 million
• Ambulance/hospital transport to 500,000rp
• First aid to 1 million rp

The compensation can be reclaimed from the driver who caused an accident:

• without driving licence
• drunk/on drugs
• who did not pay the SWDKLJJ

The TNKB or tanda nomor kendaraan bermotor, or plat nomor, or number plate carries a fee of 60,000rp for motorcycles, 100,000rp otherwise. It is replaced (carrying a cost to actually replace the plate), and paid at the same time as the STNK.

The Buku Pemilik Kendaraan Bermotor/BPKP or ownership book/black book is charged at 225,000rp per change of owner (including new) for motorcycles, 375,000rp for other vehicles.

A surat mutasi kendaraan bermotor ke luar daerah is required to bring a vehicle out of the area. This costs 150,000rp/250,000rp motorcycles/cars.

Regional vehicle taxes

See e.g.:

• Bali:PerDa 1/2011 as modified by 1/2015, 8/2016 and 9/2019 and PerGub 9/2021 as modified by 36/2021

BBNKB

Bea Balik Nama Kendaraan Bermotor is the fee to change the name (change of ownership) of a vehicle, as well as the new registration charge. According to the law on regional taxation, the maximum rate is 20% for a new registration, and 1% for subsequent transfers, levied on the Nilai Jual Kendaraan Bermotor. The NJKB is usually set regionally based on year and type. The NJKB is set at selling price before BBNKB, PKB and PPN, but including PPnBM.

Here is the 2021 NJKB table for Bali (522 pages!). Note that most vehicles are listed with a 4-letter code, not necessarily with a model name.

The ‘standard’ rate of BBNKB for a new vehicle is 10%, but 9% applies in Aceh, 12% in Maluku, 12.5% in Jakarta, and 15% in NTB, NTT, Bali and East Kalimantan. Unlike the taxes above it is collected by the provincial government, which makes the movement of vehicles around Indonesia somewhat complicated. BBNKB II (for subsequent transfers, including moves between provinces) is typically 1%, with waivers for inheritance etc. There is a (typically) 25% penalty for payment of BBNKB later than 30 days after buying a vehicle (e.g., based on invoice date for second-hand purchase).

PKB

PKB or Pajak Kendaraan Bermotor — Motor Vehicle Tax is an annual tax, levied separately on two/three-wheeled and four-wheeled vehicles. There is a progressive rate of tax, such that for each extra vehicle that is registered, the PKB rate increases. PKB for a first vehicle must be between 1% and 2%. The maxmimum progressive rate is 10%.

For Bali:

up to 249 cc motorcycles:

• 1.5% 1st, 2% 2nd, 2.5% 3rd, 3% 4th, subsequently 3.5%

250cc+ motorcycles, and 4-wheel vehicles such as cars:

• 1.75%, 3%, 4.5%, 6%, 7.5%

The rules for PKB vary by region — e.g., in North Sumatra there is no cc distinction for motorcycles, and the highest rate is 4%, while the lowest rate is 1.75%.

There are discounts for public transport, large trucks, etc.

PKB is not levied on the NJKB, but instead on DP PKB (dasar pengenaan PKB, which is NJKB multiplied by a road-damage coefficient, which is between 1 and 1.1 for most vehicles, e.g., 1 for motorcycles, 1.05 for MPVs, 1.1 for pick-up trucks, etc.)

There are usually monthly fines for late payment of PKB of around 2% monthly, plus for periods longer than a year, the fine may be calculated based on entire years. There is typically a biennial tax amnesty (no fixed schedule, check per province), where the tax can be paid off without fines being incurred.

Example tax calculation on used motorbike purchase

The Yamaha Nmax 2018 ABS which then cost 30 million and now cost 33 million is type Yamaha 2DP RA AT, and is listed for Bali as 24.1 million rp NJKB.

The costs associated with buying a used one are therefore:

• 1% BBNKB (title transfer tax) = 241,000rp
• Change of owner in BPKB (ownership book) = 250,000rp (flat)

To renew STNK/plate for 5 years:

• STNK 100,000rp (registration certificate)
• TNKB 60,000rp (number plate)
• SWDKLJJ 32,000rp (victims’ compensation fund)

PKB (annual tax, when due):

• 1.5% = 360,500rp