Minister Sri Mulyani Sets VAT Incentive Regulation for House Purchases under IDR5 Billion

SEAToday.com, Jakarta - Finance Minister Sri Mulyani has issued a regulation to incentivize the purchase of home property with a price below IDR 5 billion in the form of government-borne value-added tax (VAT). The regulation is contained in Minister of Finance Regulation (PMK) Number 120 of 2023, which was signed on November 21, 2023.

In the regulation, the provision of government-borne VAT applies to houses under the price of 5 billion rupiah, but only up to the value of 2 billion rupiah that is borne by the government. Government-borne VAT is also divided into two periods for the property handover date.

Government-borne VAT can be utilized by each individual for the acquisition of one landed house or one unit of flats. The regulation applies to Indonesian citizens who have a taxpayer identification number (NPWP) or population identity number (NIK) and to foreigners who have an NPWP as long as they fulfill the provisions of laws and regulations governing the ownership of landed houses or flats for foreigners.