Govt requires e-commerce to collect income tax from sellers

Published 2 days ago• 2 minute read

Online merchants are required to report their sales invoice information to the e-commerce platform, which will then forward it to the Tax Directorate General.

Click and buy: A Jakarta resident uses a device to shop on a local e-commerce platform on June 15. The digital market continues to thrive in Indonesia and Asia in general. (Antara/Muhammad Adimaja)

he Finance Ministry has issued a new regulation requiring e-commerce players to collect income tax from sellers on their platforms, as the government seeks to boost tax compliance among online merchants.

This rule is outlined in Finance Ministry Regulation No. 37/2025, which took effect on July 14.

The regulation requires online marketplaces operating in the country to withhold and remit a 0.5 percent income tax on sellers earning more than Rp 500 million (US$30,700) annually.

Online marketplaces that will be subject to the new rule include TikTok Shop and Tokopedia, both owned by Chinese digital giant ByteDance, Shopee of Singapore’s Sea Limited, Lazada of China’s Alibaba Group and Blibli of Djarum subsidiary Global Digital Niaga. It only exempts certain sellers, such as courier services, phone credit vendors and jewelry merchants.

Online merchants are required to report their sales invoice information to the e-commerce platform, which will then forward it to the Tax Directorate General. Although the rule came into effect immediately, platforms have been given one month to comply.

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Tax Directorate General spokesperson Rosmauli said the regulation was introduced amid a surge in online marketplace transactions in Indonesia, especially after the COVID-19 pandemic, which accelerated the shift in consumer behavior toward digital platforms.