A breath of fresh air for gold bars and jewelry trade in the form of income tax and value-added tax relief. Find out more our insights about this topic in our Legal Brief Publication.

1. Legal Brief
Taxation on Gold Bars and Jewelry

2. Introduction
Background
On 28 April 2023, Minister of Finance (“MoF”) enacted the Minister of Finance Regulation No. 48 of 2023 (“MoFR No.
48/2023”) to ensure legal certainty, fairness, and simplification in imposing tax on the sale/delivery of gold jewelry, gold bars,
non-gold jewelry, gemstones and/or similar stones.
Definition and Abbreviation
Value-Added Tax is abbreviated as “VAT”.
Gold Jewelry is any form of jewelry of which some or whole materials are from gold, including those that are equipped with
gemstones and/or other materials which are attached to or contained within the relevant gold jewelry.
Gold Jewelry Manufactures are entrepreneurs that produce Gold Jewelry and carry out activities of Gold Jewelry
purchasing and selling and/or delivery of services related to Gold Jewelry.
Gold Jewelry Traders are entrepreneurs that conduct activities of Gold Jewelry purchasing and selling and/or delivery of
services related to Gold Jewelry.
Article 21 Income Tax is income tax regulated in Article 21 of the Income Tax Law (hereinafter abbreviated as
“Art-21 Income Tax”).
Article 22 Income Tax is income tax regulated in Article 22 of the Income Tax Law (hereinafter abbreviated as
“Art-22 Income Tax”).
Article 23 Income Tax is income tax regulated in Article 23 of the Income Tax Law (hereinafter abbreviated as
“Art-23 Income Tax”).
Entrepreneurs are individuals or entities which produce goods, import goods, export goods, conduct trading business, utilize
intangible goods from outside the customs area, conduct service including exporting services, or utilize services from outside
the customs area.
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3. Overview
Income
Tax
Tax
Subject
VAT
Tax
Object
Tax income in relation to income accrued from
the sale and/or delivery of goods and related
services, including its imposition procedures and
exemptions thereof.
MoFR No. 48/2023 stipulates income tax and VAT
imposition on tax object containing the sale/delivery of
Gold Jewelry, gold bars, non-gold jewelry, gemstones
and/or similar stones, including the delivery of related
services thereof, conducted by tax subject namely Gold
Jewelry Manufactures and Gold Jewelry Traders.
VAT imposition upon the sale and/or delivery
goods and related services, including the
imposition procedures and exemptions thereof.
Goods and related services for which the sale
and/or delivery thereof are subject to income tax
imposition, including its imposition procedures
and exemptions.
Tax imposed according to the subject involved in
the sale and/or delivery of goods or related
services, whether the seller, deliverer, buyer, or
receiver, including exemptions thereof.
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4. Taxpayers who are subject to final income tax based on
the provisions in the taxation sector that regulate
income tax on income from business obtained by
taxpayers who have certain gross revenues.
Income Tax (1/2)
Delivery of Gold Jewelry resulting from the production of Gold Jewelry from Gold Jewelry
Manufactures to Gold Jewelry Entrepreneurs that are order Gold Jewelry, with
specifications, raw material, semi-finished goods, and/or auxiliary materials for said Gold
Jewelry either partially or entirely provided or delivered by God Jewelry Entrepreneurs
that order the God Jewelry.
Subject to Art-22 Income Tax
Sale of Gold Jewelry and/or gold bars
Delivery of Gold Jewelry and/or gold bar raw materials from Gold Jewelry Entrepreneurs
that order Gold Jewelry to Gold Jewelry Manufactures, which is intended to produce
Gold Jewelry.
Gold Jewelry Entrepreneur that conduct sale of non-gold jewelry and/or gemstones
and/or similar stones.
Delivery of non-gold jewelry and/or gemstones and/or similar stones as raw materials
from God Jewelry Entrepreneurs to Gold Jewelry Manufactures, which is intended to
produce Gold Jewelry.
Subject exclusion to Art-22 Income Tax
Collection of Art-22 Income Tax shall not be carried out for
the sale of Gold Jewelry, gold bars, non-gold jewelry,
gemstones and/or similar stones by Gold Jewelry
Entrepreneurs and/or gold bar Entrepreneurs to:
End consumer.
Taxpayers who have certificate of exemption from the
collection of the Art-22 Income Tax by other parties in
accordance with the provisions in the taxation sector.
Gold Jewelry Entrepreneurs and/or gold
bar Entrepreneurs, including Gold
Jewelry Manufactures and Gold Jewelry
Traders, are appointed to collect,
deposit, and/or report Art-22 Income
Tax on the sale of Gold Jewelry and/or
gold bars.
Rate of Art-22 Income Tax shall be
0,25% of the selling price of Gold
Jewelry or gold bars and not constitute
as final tax income.
Resident taxpayers both individuals and business entities who
receive gross revenues up to Rp4.800.000.000 in 1 (one) fiscal
year shall be imposed by 0,5% final tax income.
Business with certain gross revenues
Imposition of final tax income above shall exclude to:
a. Individual taxpayers accrue income derived from
professional services.
b. Income derived from sources abroad and its taxes have
been paid overseas.
c. Income is imposed by final tax income according to
other provisions of taxation law.
d. Income that is not considered tax object.
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5. Income Tax (2/2)
Income derived from remuneration of services
related to Gold Jewelry, gold bars, non-gold
jewelry, gemstones and/or other similar stones
shall be considered as a tax object.
Income Tax on Related Services
Services containing:
a. Modification services;
b. Repair services;
c. Coating services;
d. Gilding services;
e. Cleaning services; and
f. Other services which constitute other names of services as
referred to point (a) to (e).
Tax imposed on services if remuneration accrued by:
a. Resident individual taxpayers, shall be withheld with the Art-21
Income Tax.
b. Resident corporation taxpayers, shall be withheld with the Art-
23 Income Tax.
Tax rate of tax imposition above is in accordance with taxation
laws.
Exemption for tax imposition
Tax shall not impose on income accrued by:
a. Taxpayers who are subject to final income tax based on
the provisions in the taxation sector that regulate
income tax on income from business obtained by
taxpayers who have certain gross revenues.
b. Taxpayers who have certificate of exemption from the
withholding of the Art-21 Income Tax and/or Art-23
Income Tax by other parties in accordance with the
provisions in the taxation sector.
Business with certain gross revenues
Resident taxpayers containing individual and business entities who receive
gross revenues up to Rp4.800.000.000 in 1 (one) fiscal year shall be imposed
by 0,5% final tax income.
Imposition of final tax income above shall exclude to:
a. Individual taxpayers accrue income derived from professional services.
b. Income derived from sources abroad and its taxes have been paid
overseas.
c. Income is imposed by final tax income according to other provisions of
taxation law.
d. Income that is not considered tax object.
Implementation
Provisions
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6. VAT(1/3)
Gold Jewelry Traders
VAT Subjects
Gold Jewelry Manufactures
Obligations
Gold Jewelry Manufacturers and Gold
Jewelry Traders must carry out these
following actions:
Report their business to be
confirmed as taxable
Entrepreneurs; and
Collect and deposit the payable
VAT on the delivery of Gold
Jewelry and/or services related to
Gold Jewelry, gold bars, non-Gold
Jewelry, and/or gemstones and/or
other similar stones, with certain
amount.
2
1
A
B VAT Objects
Services
Goods
The obligation above shall be valid for
Gold Jewelry Manufactures and Gold
Jewelry Traders which are a small-scale
Entrepreneurs.
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7. VAT (2/4)
VAT Object VAT shall impose on the delivery of:
1
Gold jewelry and gold bars;
Gold Jewelry as a result of production from taxable Entrepreneurs
of Gold Jewelry Manufacturers to Gold Jewelry Entrepreneurs that
order Gold Jewelry, of which specifications, raw materials, semi-
finished goods, and/or auxiliary materials for said Gold Jewelry are
either partially or entirely provided or delivered by the Gold Jewelry
Entrepreneurs that order Gold Jewelry;
Raw materials in the form of Gold Jewelry from taxable
Entrepreneurs of Gold Jewelry Manufacturers or taxable
Entrepreneurs of Gold Jewelry Traders that order Gold Jewelry to
Gold Jewelry Manufacturers, which is intended to produce Gold
Jewelry; and
Non-Object of VAT
Services related to Gold Jewelry, gold bars, jewelry of which the
whole materials are not from gold, and/or gemstones and/or other
similar stones, which is conducted by Gold Jewelry Manufacturers
and Gold Jewelry Traders.
Services containing:
Modification services
Repair services
Coating services
Gilding services
Cleaning services Other services which constitute
other names of services as
mentioned above
2 VAT shall be imposed upon the delivery of gold bars in the interest of
state’s foreign exchange reserves.
Gold Jewelry Manufactures or
Gold Jewelry Traders who
conduct delivery in relation to VAT
Object shall collect and deposit
VAT thereof.
Gold Jewelry Manufactures or
Gold Jewelry Traders shall report
the collected and deposited VAT in
the periodic VAT return.
Tax invoice shall be issued by the
Gold Jewelry Manufactures or
Gold Jewelry Traders whenever
VAT Object is delivered.
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8. VAT (3/4)
Certain VAT Tariff
1
Delivery to
Gold Jewelry
Manufactures who
conduct delivery of
Gold Jewelry resulting
from their own
production.
▪ Other Gold Jewelry
Manufactures; or 10% of the VAT tariff
as regulated in Article
7 of the VAT Law.
Tariff
End consumer Tariff
Delivery to
15% of the VAT tariff
as regulated in Article
7 of the VAT Law.
▪ Other Gold Jewelry
Manufactures; or
▪ End consumers.
10% of the VAT tariff
as regulated in Article
7 of the VAT Law.
2
Delivery to
Gold Jewelry
Traders who
conduct delivery
of Gold Jewelry
resulting from
their own
production.
Do not have
a tax invoice
Have a tax
invoice
15% of the VAT tariff
as regulated in Article
7 of the VAT Law.
Tariff
Gold Jewelry
Manufactures
Delivery to Tariff
0% of the VAT
tariff as regulated
in Article 7 of the
VAT Law.
If Gold Jewelry Manufactures or Gold Jewelry Traders,
as referred to No. 1 and No. 2, also conduct delivery of
non-gold jewelry, gemstones, and/or other similar
stones, such delivery shall be imposed by a 10% of VAT
tariff as regulated in Article 7 of the VAT Law.
▪ Gold, Jewelry,
Traders.
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9. VAT (4/4)
In the event Gold Jewelry Traders
conduct VAT collection without
using the certain VAT tariff
mentioned before, the Gold Jewelry
Traders should adjust the VAT tariff
accordingly.
Input tax related to certain VAT tariff
of the delivery of the VAT object
conducted by Gold Jewelry
Manufactures or Gold Jewelry
Traders mentioned before cannot
be credited.
Certain VAT tariff related to the
delivery of the VAT object
conducted by Gold Jewelry
Manufactures or Gold Jewelry
Traders mentioned before shall not
apply prior to being confirmed as
taxable entrepreneurs but instead
apply to VAT tariff as regulated in
Article 7 of the VAT Law.
Gold Jewelry Manufactures or Gold
Jewelry Traders who conduct
delivery of services related to Gold
Jewelry, gold bars, non-gold
jewelry, gemstones and/or other
similar stones shall be imposed by
10% of the VAT tariff as regulated
in Article 7 of VAT Law.
VAT Tariff for Services
A
Tax Policy to Support
Ease of Doing Business
Implementation Provision
B
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10. • We will continue to follow the developments on this topic and provide additional information as it
becomes available. If you have any questions on this topic, please contact:
Zaka Hadisupani Oemang
zaka@ahrplaw.com
Radhitya Hawari
radhitya@ahrplaw.com
M. Sakti Tambunan
sakti@ahrplaw.com
This publication has been prepared by AHRP for educational and informational purposes only. The information contained in this publication is not
intended and should not be construed as legal advice. Due to the rapidly changing nature of law, AHRP makes no warranty or guarantee concerning
the accuracy or completeness of this content. You should consult with an attorney to review the current status of the law and how it applies to your
circumstances before deciding to take any action.
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