Official Incentives Apply, Buy an Electric Car Only Pay 1 Percent VAT

Jakarta, CNN Indonesia —

The incentive to purchase a new electric car with a 10 percent discount on Value Added Tax (VAT) to 1 percent officially takes effect in early April 2023.

The determination of the VAT discount on the purchase of electric cars is contained in Minister of Finance Regulation Number 38 of 2023 concerning VAT on the Delivery of Four-Wheel Battery-Based Electric Motorized Vehicles and Certain Bus Battery-Based Electric Motorized Vehicles to be Borne by the Government for the 2023 Fiscal Year.

The regulation contains 12 articles explaining the implementation scheme of subsidies for government assistance for these emission-free cars and buses.

For example, in Article 3 it is explained that cars and electric buses that receive subsidies must comply with government requirements, namely the Domestic Content Level (TKDN).

The TKDN value criteria as referred to in paragraph (1) are as follows:
a. Certain Four Wheel Battery-Based KBL with a minimum TKDN value of 40% (forty percent);
b. Certain Bus Battery-Based KBL with a minimum TKDN value of 40% (forty percent)
c. Certain Bus Battery-Based KBLs with a minimum TKDN value of 20% (twenty percent) to less than 40% (forty percent), reads Article 3 paragraph 2 of the regulation.

The regulation makes 12 articles with attachments in the form of examples of VAT calculations from these subsidies.

According to Article 12, the regulation officially took effect on April 1, 2023, which was determined by the Minister of Finance, Sri Mulyani, on March 28, 2023.

“This Ministerial Regulation comes into force on April 1, 2023,” the regulation reads.

As is known, electric car subsidies will only apply to two models, namely the Hyundai Ioniq 5 and Wuling Air EV, because only these two brands meet the requirements, namely 40 percent TKDN.

While electric buses are potential recipients of subsidies until the end of the new year, there are four companies, namely Mobil Anak Bangsa (MAB), Inka, Bakrie and Indonesian Electric Vehicles (KLI).

(Gambas:Video CNN)


(Gambas:Video CNN)

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