New Stamp Duty IDR 10,000.00: Indonesia Increasing Fixed Stamp Duty Rate in January 1, 2021

The House of Commission Representatives XI along with the executive government of Representatives Indonesia have officially passed and approved the enactment the stamp duty’s rate, from a layered-tariff system into a single-tariff system, which was issued on October 26, 2020. The said adjustment is listed under Law Number 10 of 2020 on Stamp Duty (“Law 10/2020”), which revoked Law Number 13 of 1985 on Stamp Duty (“Law 13/1985”). Starting on January 1, 2021, the former stamp duty of IDR 3,000.00 and IDR 6,000.00 will be replaced with a single tariff of IDR 10,000.00. During the transition process, the Law 10/2020 provides a year of transition period, which has been regulated under these transitional provisions, i.e:

1. Stamp duty on dutiable documents made up to December 31, 2020 shall continue to follow Law 13/1985; and
2. Stamp Duties which have been printed based on Law 13/1985 can still be used latest until December 31, 2021 by affixing at least 2 (two) stamps until the value amounts to at least IDR 9,000.00 instead of the required IDR 10,000.00 (e.g., a piece of IDR 6,000.00 and IDR 3,000.00 stamp each, a pair of IDR 6,000.00 stamps, or 3 (three) pieces of IDR 3,000.00 stamps)

The new single-tariff stamp duty system of IDR 10,000.00 is only imposed on documents stating a sum of money above IDR 5 million, which describe the receipt of money or contain an acknowledgement of debt payment or settlement, either entirely or partially.

The other basic rules of Stamp Duty under Law 10/2020 remain largely unchanged. However, this new regulation adds several documents concerning civil matters which now shall be noted as dutiable, including but not limited to:

1. Securities transaction documents including for futures contract transactions in any name or form;
2. Auction documents in the form of excerpts, minutes, copies and executorial deeds (grosse); and
3. Other documents stipulated by Government Regulation.

Based on Article 12 of Law 10/2020, the stamp duty is payable via the following media:

1. Stamps, including affixed stamp duty, electronic stamps or other forms of stamp as stipulated by the Minister of Finance; or
2. Tax-payment slips.

A post-dated stamp duty can also still be enforced under the new regulation, on the occasion that a dutiable document has yet been paid fully for its stamp duty and/or the said document is being used as evidence in court. An administrative sanction in the amount of 100% of the indebted stamp duty will be charged along with the indebted stamp duty consecutively.

Please note that an agreement shall not be deemed to be null and void or voidable, as the requirements for an agreement to be valid are not determined according to the existence of the stamp duty but are determined by Article 1320 of the Civil Code. Instead of being void, agreements without a stamp duty would not be considered or accepted by Indonesia’s public authorities pursuant to Article 3 of Law 10/2020.

The obligation to insert a stamp duty essentially is to prove that such document tax has been paid to the government as stipulated in the corresponding regulation of stamp duty. For further inquiries on the matter, do not hesitate to contact Ms. Gabriella Lienardo ([email protected] or [email protected])