LGST Borne by the Government on the Delivery of Certain Motor Vehicles
- April 13, 2021
- Posted by: Administrator
- Category: Tax News
In line with the spirit of the above VAT incentive, on March 31, 2021, the MoF also stipulated a new Regulation No.31/PMK.010/2021 (“PMK-31”) to support the motor vehicle industry during the COVID-19 pandemic. Through PMK-31, the Luxury Goods Sales Tax (“LGST”) payable on the delivery of certain motor vehicles shall be borne by the Government.
The applicable percentage and period of the LGST incentive vary depending on the type of the vehicle and its cylinder capacity, as follows:
| No | Vehicles with ignition or compression ignition engines (diesel or semi-diesel) | Cylinder
Capacity |
LGST Borne by Govt and the Applicable Tax Period |
| 1 | Sedan or station wagon | ≤ 1500 cc
|
-100% for Tax Period April to May 2021
-50% for Tax Period June to August 2021 -25% for Tax Period September to December 2021 |
| 2 | Vehicle for the transportation of less than 10 (ten) people including driver other than sedan or station wagon with a 1 (one) drive wheel (4×2) system | ||
| 3 | Vehicle for the transportation of less than 10 (ten) people including driver other than sedan or station wagon with a 1 (one) drive wheel (4×2) system | > 1500 – 2500 cc | -50% for Tax Period April to August 2021
-25% for Tax Period September to December 2021 |
| 4 | Vehicle for the transportation of less than 10 (ten) people including driver other than sedan or station wagon with a 2 (two) drive wheel (4×4) system | > 1500 – 2500 cc | -25% for Tax Period April to August 2021
-12.5% for Tax Period September to December 2021 |
However, please be aware that to implement these LGST incentives, the motor vehicle as intended above must meet the requirements of local purchase set by the Ministry of Industry, including the fulfillment of local content of at least 60% (sixty percent). Similarly, please be aware that certain requirements and administrative procedures regarding the VAT invoice issuance and the realization report should be fulfilled; otherwise, the LGST incentive may not be implemented.
PMK-31 also prescribes the format of Motor Vehicle List which shall be a part of the realization report. The realization report is submitted through a specific platform on www.pajak.go.id.