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Exemption of Land and Building Tax Located in Village and Urban Area for House, Simple Lease Condominium, Simple Ownership Condominium with Tax Object Sales Value up to One Billion Rupiah

By May 31, 2019 No Comments

Background

On 15 April 2019, the Governor of DKI Jakarta enacted the Regulation of DKI Jakarta Governor Number 38 of 2019 on Second Amendment of Regulation of DKI Jakarta Governor Number 259 of 2015 on Exemption of Land and Building Tax in Village and Urban Area for House, Simple Lease Condominium, and Simple Ownership Condominium with Tax Object Sales Value up to Rp1,000,000,000 (“Pergub 38/2019”). The Pergub 38/2019 revokes the Regulation of DKI Jakarta Governor Number 25 of 2018 on Amendment of Regulation of DKI Jakarta Governor Number 259 of 2015.

The Land and Building Tax in Village and Urban Area is the tax on land and/or building which is owned, controlled, and/or utilized by individual or entity located in the village and urban area, except for the area that is used for plantation, forestry, and mining activity (“PBB-P2”).

The Exemption of PBB-P2

Under the Regulation of DKI Jakarta Governor Number 259 of 2015, the following tax objects will be exempted to pay PBB-P2:

  1. a house that is owned by individual with the limit of Tax Object Sales Value (“NJOP”) up to Rp1,000,000,000; and

  2. simple ownership condominium that is used for residence, and simple lease condominium that is owned or leased by the government that has been divided into condominium units, with the limit of NJOP up to Rp1,000,000,000.

The exemption of PBB-P2 will be given 100% from the outstanding of PBB-P2. The exemption of PBB-P2 will be given to individual taxpayers that:

  1. have one tax object in the Province of DKI Jakarta with the NJOP up to Rp1,000,000,000; and
  2. have more than one tax objects in the Province of DKI Jakarta, where the NJOP of each tax objects up to Rp1,000,000,000.

The tax exemption is excluded for the tax object that has gone through a data change due to the transfer of ownership rights or possession or cultivation to the entity taxpayer.

Procedures of PBB-P2 Exemption

The Tax Service Office or the Information Technology of Regional Tax Division will conduct data inventory of total tax objects and determinations which have the NJOP up to Rp1,000,000,000. This data inventory shall be reported to the Head of Tax Services Unit. After receiving the data inventory, the Head of Tax Services Unit will conduct a research on the data inventory and report it to the Head of Information Technology of Regional Tax Division.

The Head of Information Technology of Regional Tax Division will combine the results of the research from Head of Tax Services Unit and give certain codes as the identification for the issuance of notification letter of PBB-P2. Under the Pergub 38/2019, the exemption of PBB-P2 as mentioned above shall only valid until 31 December 2019. The individual taxpayers who have been granted with the exemption of PBB-P2 until 2018, before the enactment of this Governor Regulation, will still be granted with the exemption of PBB-P2.


Indira Sarah Lumbanraja