Heaptalk, Jakarta — Sufmi Dasco, Deputy Speaker of the House of Representatives, announced that the government imposed a 12% VAT on luxury cars, effective January 1, 2025. “Luxury cars, luxury apartments, luxury houses, everything luxurious,” said Dasco in a press release in Jakarta.
However, Dasco mentioned that the types of cars are still being discussed. He voiced, “Referring to existing regulations, the government has already made rules for luxury cars with different tax criteria from lower-specification cars.”
The regulation is to manage the Sales Tax on Luxury Goods (PPnBM) as stated in the Minister of Finance Regulation Number 141/PMK.010/2021 on the Determination of Types of Motor Vehicles Subject to Sales Tax on Luxury Goods and Procedures for Imposition, Exemption, and Refund of Sales Tax on Luxury Goods.
Article 2 of the regulation explains that the types of taxable luxury goods include motor vehicles for transporting people with a capacity of up to 10 people, including the driver, with an engine capacity of up to 3,000 cc, subject to Sales Tax on Luxury Goods at rates of 15%, 20%, 25%, or 40%.
Furthermore, Article 3 mentions that the types of taxable luxury goods include motor vehicles for transporting people with a capacity of up to 10 people, including the driver, with an engine capacity of more than 3,000 cc up to 4,000 cc, subject to Sales Tax on Luxury Goods at rates of 40%, 50%, 60%, or 70%.
In addition to four-wheeled vehicles, there are also other luxury motor vehicles, as referred to in Articles 22 and 23, detailed below.
Article 22
– Two or three-wheeled motor vehicles with an engine capacity of more than 250 cc up to 500 cc.
– Special vehicles made for travel on snow, beaches, mountains, or similar vehicles, subject to PPnBM at a rate of 60%.
Article 23
The types of taxable luxury goods include:
- Motor vehicles with an engine capacity of more than 4,000 cc;
- Two or three-wheeled motor vehicles with an engine capacity of more than 500 cc; or
- Trailers, semi-trailers of the caravan type for housing or camping, subject to PPnBM at a rate of 95%.