Jakarta to lower threshold for import taxes on e-com items

25 Dec '19

2 min read

Pic: Shutterstock

Indonesia recently decided to lower the threshold at which it begins to impose import taxes on consumer goods sold via e-commerce to $3 from $75 to control purchase of cheap foreign goods and protect small domestic firms who’ve been producing goods like sandals and handbags that are traded in e-commerce. The regulation will come into effect in January end.

Overseas shipments from e-commerce purchases jumped to nearly 50 million packages so far in 2019 compared to 19.6 million packages last year and 6.1 million the year before, with most of the goods coming from China, customs statistics showed.

Under the new regulations, foreign-produced textiles, clothes, bags and shoes that cost a minimum of $3 will be subject to a range of taxes with a total rate of 32.5 per cent to 50 per cent of their value, Indonesian media reports quoted customs director general Heru Pambudi as saying.

For other products, the import taxes will be lowered from 27.5-37.5 per cent of their value to 17.5 per cent, as applicable to any goods worth $3.

Goods worth below $3 will still be subject to some taxes, such as value-added tax, though the range would be lower, something that was not required before.

Pambudi said the step was initiated in response to demands by the general public and businesses.

Fibre2Fashion News Desk (DS)

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