Jakarta. The Finance Ministry is preparing a regulation that would require digital marketplaces to collect a 0.5 percent income tax on behalf of e-commerce sellers.

Under the new scheme, income tax under Article 22 of the Income Tax Law will be imposed on sellers with annual revenues exceeding Rp 500 million ($30,800). Instead of requiring sellers to self-report and pay taxes independently, the government will delegate the tax collection to e-commerce platforms such as marketplaces and online retail aggregators.

“This is essentially a shift in the payment mechanism,” said Rosmauli, Director of Counseling, Services, and Public Relations at the Directorate General of Taxes (DJP), in a written statement on Thursday. “Previously, the responsibility to pay income tax was on the sellers. Now, the marketplace will act as the tax collector.”

The move is intended to make tax compliance easier for sellers by integrating the process directly into the platforms where they conduct business. Rosmauli said the policy does not alter the fundamental principles of income tax but offers a simplified, more accessible system.

“For sellers, this means their tax obligations are automatically handled through a streamlined process that’s integrated into their sales platform,” she said.

Importantly, micro, small, and medium enterprises (MSMEs) with annual turnover below Rp 500 million will be exempt from this tax, ensuring the policy does not burden smaller online businesses.

The regulation also aims to strengthen oversight and close gaps in the so-called shadow economy --unreported or informal business activities that often go untaxed. According to Rosmauli, many online sellers either lack awareness of tax obligations or avoid the process due to its perceived complexity.

“By involving marketplaces as the withholding agents, we hope this tax collection mechanism will encourage more proportional compliance and ensure that tax contributions reflect actual business capacity,” she added.

The regulation is currently in its "finalization stage". The government says the process has involved “meaningful participation,” with input from industry stakeholders, relevant ministries, and agencies.

“We understand the importance of clarity for businesses and the public. Once the regulation is officially enacted, we will announce it fully, clearly, and transparently,” she said.

Indonesia’s Tax Revenue Snapshot

2024 target: Rp 1,988.9 trillion

Actual 2024 collections: Rp 1,932.4 trillion (97.2 percent)

2025 target: Rp 2,189.3 trillion (+13.9 percent)

Tax‑to‑GDP ratio: 10.3 percent (2023), 11.8 percent (Dec 2024);

Tax ratio goal: 11.2–12 percent in 2025