MINISTRY OF FINANCE REGULATIONS NO. 7 YEAR 2024 (PMK 7/2024) CONCERNING VALUE ADDED TAX ON SUPPLIES OF LANDED HOUSES AND FLAT UNITS BORNE BY THE GOVERNMENT FOR THE 2024 FISCAL YEAR
To increase Indonesia’s economic growth and to stimulate public interest to spend in housing sector, the government show the support to provide fiscal incentives in the form of Value Added Tax (VAT) borne by Government. This regulation aims to continue the fiscal incentive policy in the housing sector in 2023.
1. VAT payable on the delivery of landed houses and flat units are borne by Government for period January until December 2024.
2. VAT borne by Government on the delivery of landed houses and flat units is payable at the following:
a. the signing of the sale and purchase deed made by Land Deed Official (“PPAT”) or the signing of the full payment agreement in the presence of a notary, and
b. the actual transfer of rights to use or occupy the landed house or flat by signing the Minutes of Handover (“BAST”) from period January 1 2024 to December 31 2024. Minutes of Handover must be registered in the application at the Ministry of Public Works and Public Housing (“PUPR”) and/or the Public Housing Savings Management Agency maximum at the end of the following month after the handover.
3. The criteria for the delivery of landed houses and flat units to obtain VAT borne by Government are as follows:
a. The Selling Price amounted to maximum of Rp.5.000.000.000 (five billion rupiah) and
b. is a new landed house or new flat unit which delivered in ready to occupy condition
4. New landed houses or new flat units are landed houses or flat units that have obtained
a. house identity code through an application from the Ministry of PUPR and/or the Public Housing Savings Management Agency and supplied for the first time by Taxable Entrepreneur as the contractor and never been handed over before.
5. If there is down payment or instalment paid before the enactment of this Ministry Regulation, VAT borne by Government may be granted with the following requirement:
- The first down payment or instalment is paid to the seller no later than 1 September 2023.
- BAST is signed from period 1 January 2024 until 31 December 2024.
- VAT borne by the Government is granted only to the VAT payable on the remaining instalments and settlement paid during the period from January 2024 until December 2024.
6. VAT borne by Government facilities can be utilized by an individual for the purchase of 1 (one) housing unit. Thus, consumers who have utilized VAT borne by Government facilities for 1 (one) housing unit in 2023, cannot utilize the VAT borne by Government facilities for other units in 2024.
7. Individuals who have utilized VAT borne by Government facilities based on Ministry of Finance Regulation No. 120 Year 2023, and still have installments payment in 2024, can utilize VAT borne by Government facilities on the amount of installments payment from the period 1 January 2024 to 31 December 2024.
8. Individuals who are entitled to obtain VAT borne by Government are Indonesian citizens who have a Tax Identity Number or ID Number and foreigners who have a Tax Identity Number as long as they comply with the rules regarding ownership of landed houses or flats.
9. The amount of VAT borne by Government provided to the customer are the following:
- BAST from 1 January 2024 until 30 June 2024. 100% from VAT Payable with Taxable Base up to IDR 2.000.000.000 (Two Billion Indonesian Rupiah) with maximum selling price IDR 5.000.000.000 (Five Billion Indonesian Rupiah).
- BAST from 1 July 2024 until 31 December 2024. 50% from VAT Payable with Taxable Base up to IDR 2.000.000.000 (Two Billion Indonesian Rupiah) with maximum selling price IDR 5.000.000.000 (Five Billion Indonesian Rupiah).
10. To apply the VAT incentives borne by Government, Taxable Entrepreneur must register through the application of the ministry that handles government affairs in the field of housing and residential areas and/or the Public Housing Savings Management Agency no later than July 1 2024
This regulation was promulgated on February 1, 2024 and come into effect on the date of promulgation.
Rani Widianti
T. (+6221) 2222-0200
E. [email protected]
Alvina Oktavia
T. (+6221) 2222-0200
E. [email protected]
