March 27, 2024
Policy & Regulation

Indonesia’s Crypto Regulator Calls for Dual Taxation on Crypto Transactions

In a bid to foster a more conducive environment for the burgeoning cryptocurrency industry, Indonesia’s Commodity Futures Trading Supervisory Agency (Bappebti) has formally requested the Finance Ministry to reevaluate the current ‘dual taxation’ on crypto transactions. Presently, cryptocurrencies in Indonesia are classified as commodities, subjecting them to a 0.11% value-added tax and a 0.1% income tax.

Bappebti officials argue that the imposition of double taxation on crypto transactions warrants a fresh examination. Tirta Karma Senjaya, the head of Bappebti, disclosed that the classification of cryptocurrencies as commodities might undergo a change in 2025. This anticipated shift is attributed to the impending transfer of crypto oversight responsibilities from Bappebti to the financial services authority OJK.

“With crypto expected to join the financial sector by January 2025, we urge the Tax Director General to review these taxes. It’s been over a year since these rules were put in place, and taxes usually get checked every year,” emphasized Tirta at an event in Jakarta.

He underscored that the crypto industry and its regulatory framework are still in their infancy. Tirta believes it is essential to allow the sector room to grow before imposing significant tax burdens, enabling it to make a more substantial contribution to national revenue.

The existing tax structure on cryptocurrencies has been operational since April 2022 and has proven lucrative, generating approximately $2.49 million in revenue in January 2024 alone. In the preceding year, Indonesia amassed $41.2 million in revenue from crypto taxes.

Responding to Bappebti’s request for a reassessment, Dwi Astuti, a spokesperson for the Ministry of Finance, affirmed the Ministry’s commitment to consider input from industry players and the public. “We accept input from Bappebti, the community. It will definitely be discussed internally,” assured Astuti during a media chat, signaling a potential review of the current tax regime on cryptocurrencies in Indonesia.

Image by Drazen Zigic on Freepik

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