DECREE OF THE MINISTER OF FINANCE
No.463/KMK.01/1998

CONCERNING
AMENDMENT TO THE DECREE OF THE MINISTER OF FINANCE NO.239/KMK.01/1996 REALIZATION OF GOVERNMENT REGULATION No.42/1995 CONCERNING THE IMPORT DUTY, SURCHARGES, VALUE ADDED TAX AND SALES TAX ON LUXURY GOODS, AND INCOME TAX IN THE FRAMEWORK OF REALIZATION OF GOVERNMENT PROJECTS FINANCED BY OVERSEAS GRANTS OR LOANS

THE MINISTER OF FINANCE,

Considering :

that in connection with the stipulation of Government Regulation No.63/1998, it is deemed necessary to amend the Decree of the Minister of Finance No.239/KMK.01/1996 as the further directive for the said Government Regulation by issuing a decree of the Minister of Finance;

In view of :

• 1. Law No.6/1983 on the general provisions on and procedures for taxation (Statute Book of 1983 No.49, Supplement to Statute Book No.3262) as already amended by Law No.9/1994 (Statute Book of 1994 No.59, Supplement to Statute Book No.3566);
• 2. Law No.7/1983 on the income tax (Statute Book of 1983 No.50, Supplement to Statute Book No.3263) as already amended several times the latest by Law No.10/1994 (Statute Book of 1994 No.60, Supplement to Statute Book No.3567);
• 3. Government Regulation No.47/1994 on the calculation of taxable income and the settlement of tax in the current year (Statute Book of 1994 No.67, Supplement to Statute Book No.3579);
• 4. Government Regulation No.63/1998 on amendment to Government Regulation No.42/1995 concerning the import duty, surcharges, value added tax and sales tax on luxury goods, and income tax in the framework of realization of government projects financed by overseas grants or loans (Statute Book of 1998 No.107, Supplement to Statute Book No.3770);
• 5. Presidential Decree No.122/M/1998;
• 6. Decree of the Minister of Finance No.239/KMK.01/1996 on realization of Government Regulation No.42/1995 concerning the import duty, surcharges, value added tax and sales tax on luxury goods, and income tax in the framework of realization of government projects financed by overseas grants or loans;

DECIDES:

To stipulate :

THE DECREE OF THE MINISTER OF FINANCE CONCERNING AMENDMENT TO THE DECREE OF THE MINISTER OF FINANCE NO. 239/KMK.01/1996 ON REALIZATION OF GOVERNMENT REGULATION NO. 42/1995 CONCERNING THE IMPORT DUTY, SURCHARGES, VALUE ADDED TAX AND SALES TAX ON LUXURY GOODS, AND INCOME TAX IN THE FRAMEWORK OF REALIZATION OF GOVERNMENT PROJECTS FINANCED BY OVERSEAS GRANTS OR LOANS.

Article I

To amend several provisions in the Decree of the Minister of Finance No.239/KMK.01/1996 on realization of Government Regulation No.42/1995 concerning the import duty, surcharges, value added tax. and sales tax on luxury goods, and income tax in the framework of realization of government projects financed by overseas grants or loans, to become as follows :

1. To supplement a new provision after Article 1 letter f as Article 1 letter g and amend the provision of letter g to become the provision of letter h, so that Article 1 letters g and h read as follows :

"Article 1

g. The second-tier contractors, consultants and suppliers shall be the contractors, consultants and suppliers receiving jobs from the main contractors, consultants and suppliers in the framework of realization of government projects financed by overseas grants;

h. A contract shall be an Agreement on the Procurement of Goods and Provision of Services (KPBJ) or other documents treated as such, which is signed by the project manager or authorized official and the main contractor, or the main contractor and second-tier contractor."

2. To amend the provision of Article 4 paragraph (3) and supplement the provision of paragraph (4), so that Article 4 entirely reads as follows :

"Article 4

(1) The Income Tax (PPh) owed by the main contractors as from April 1, 199 5 on income received or earned in connection with realization of government projects whose funds are wholly derived from overseas grants or loans, shall be borne by the government.

(2) The Income Tax (PPh) owed by the main contractors as from April 1,1995 on income received or earned in connection with realization of government projects whose funds are partially derived from overseas grants or loans, shall be borne by the government only for the part of income in connection with realization of government projects whose funds are derived from overseas grants and loans.

(3) The Income Tax (PPh)-Article 21 owed by foreign employees working with the main contractors, consultants and suppliers on income received or earned because the jobs executed are in the framework of realization of government projects financed by grants, shall be borne by the government.

(4) The Income Tax (PPh) owed by the second-tier contractors, consultants, suppliers on income received or earned because the jobs executed are in the framework of realization of government projects financed by grants, shall be borne by the government."

3. To supplement a new provision after Article 5 paragraph (2) as Article 5 paragraph (3) reading as follows :

"Article 5

(3) The income tax owed by the second-tier contractors, consultants and suppliers in connection with realization of government projects financed by grants, which are borne by the government, as meant in Article 4 paragraph (4) shall be credited from the amount of the income tax owed on their total income."

Article II

This decree shall come into force as from the date of stipulation.

For public cognizance this decree shall be published by placing it in State Gazette of the Republic of Indonesia.

Stipulated in Jakarta
On October 21,1998

THE MINISTER OF FINANCE
sgd.
BAMBANG SUBIANTO