Indonesia is set to require e-commerce platforms to withhold 0.5 percent of sellers’ sales revenues and remit that amount as tax to the government. This policy targets small and medium-sized enterprises (SMEs) with yearly turnover between 500 million and 4.8 billion rupiah—sellers who are already obligated to pay the tax directly. According to Tax Office sources, the rule could take effect as early as next month, though no official date has been announced. Platforms like Tokopedia, Shopee, TikTok Shop, Lazada, Blibli, and Bukalapak are expected to be impacted. The government sees this move as essential to plug gaps in the so-called shadow economy, where informal sellers avoid tax obligations.
Industry groups, including the e-commerce association idEA (Indonesian E-Commerce Association), have voiced support in principle but highlighted concerns over implementation. They warned that the tight timeline may impose strains on payment systems and backend operations, especially for platforms with millions of users. As an example of scale, Tokopedia alone has around 12 million sellers, with 2023 transactions totaling 249 trillion rupiah (US$ 15.3 billion). Platforms are reportedly seeking more time to integrate withholding into their systems and to avoid pushing sellers away. The Tax Office presentation, as viewed by Reuters, reportedly outlines penalties for non-compliance, including late remittances.
Experts and officials say the requirement aligns with international efforts, such as the OECD BEPS (Base Erosion and Profit Shifting) initiative aimed at improving digital tax transparency. By shifting the collection burden to platforms, the government expects to simplify compliance for millions of small sellers who often underreport or fail to file taxes. Fiscal data shows Indonesia’s state revenue fell by 11.4 percent from January to May 2025, increasing the urgency of reform. Meanwhile, the e-commerce ecosystem continues to grow rapidly—estimated at US$ 65 billion in 2023 value and projected to more than double by 2030. Observers warn, however, that the enhanced oversight could prompt some sellers to shift to informal platforms outside major marketplaces.
If implemented effectively, the withholding policy would mark a significant shift in Indonesia’s strategy to formalize the digital economy. Instead of relying solely on self-reporting, the government will directly collect taxes at the source, ensuring more accurate reporting. Sellers may benefit from reduced filing complexity, while the state gains a new revenue stream with minimal increase in official tax rates. Still, success will depend on platform readiness, regulatory clarity, and cooperation from SMEs. Close monitoring in the coming months will show whether Indonesia’s move can serve as a model for emerging economies navigating the challenges of taxing digital commerce.
Alexander Jason – Redaksi
