Terms of Buying an Electric Car Can Get a 10 Percent VAT Discount

Jakarta, Armfalcon.com —

Official government provides subsidy form tax incentives for buy electric car. Electric car buyers are given a discount on Value Added Tax (VAT) from 11 percent to 1 percent.

The provision of these incentives is stipulated through Regulation of the Minister of Finance (PMK) Number 38 of 2023 concerning Value Added Tax on the Delivery of Certain Four-Wheel Battery-Based Electric Motorized Vehicles and Certain Bus Battery-Based Electric Motorized Vehicles Borne by the Government for the 2023 Fiscal Year.

In this regulation, the government provides tax incentives in the form of a 10 percent VAT reduction for sales of electric vehicles. That is, when buying an electric vehicle, only 1 percent of VAT is paid.

However, there are conditions set for electric cars to get incentives that apply to the April-December 2023 tax period, namely the Domestic Component Level (TKDN) of these vehicles is at least 40 percent.

“The TKD value criterion is KBL (Electric Motorized Vehicles) based on certain four-wheeled batteries with a minimum TKDN value of 40 percent,” reads Article 3 paragraph (2a) of the regulation signed by Minister of Finance Sri Mulyani on March 28.

This applies to bus electric battery vehicles. If the TKDN of the bus is below 40 percent, then the incentives given are smaller, which is only reduced by 5 percent or 6 percent of the 11 percent VAT.

Head of the Ministry of Finance’s Fiscal Policy Agency, Febrio Kacaribu, said that this policy was launched in order to accelerate economic transformation to increase the attractiveness of investment in the electric vehicle ecosystem, expand employment opportunities, accelerate the transition from using fossil energy to electricity.

“It is hoped that in the future this will accelerate emission reduction as well as energy subsidy efficiency,” he said through an official statement, Monday (3/4).

As for the models and types of vehicles that meet the TKDN requirements, they are stipulated through Decree of the Minister of Industry Number 1641 of 2023 concerning Certain Four-Wheel Battery-Based Electric Motorized Vehicles and Certain Bus Battery-Based Electric Motorized Vehicles that Meet the Value Criteria for Domestic Component Levels which, upon delivery, can take advantage of taxes Government Borne Value Added for Fiscal Year 2023.

In addition, for the technical implementation of tax facilitation, the Director General of Metal, Machinery, Transportation Equipment and Electronics Industry of the Ministry of Industry supervises the suitability of TKDN values. This supervision can be carried out by an independent verification agency appointed by the Director General of ILMATE.

If under supervision there is a KBLBB that does not meet the TKDN value, then the government will remove the company from the list of recipients of Government Borne VAT incentives (DTP).

[Gambas:Video CNN]

(ldy/pta)

[Gambas:Video CNN]