a. that in the framework of supporting the government programs to provide housings affordable to low income communities, namely modest house, very modest house and modest flat for residing, it is necessary to provide income tax facility in the form of the exemption from Value Added Tax on delivery of modest house, very modest house and modest flat;
b. that in the framework of assisting, building and enhancing welfare of communities whose resettlement is affected by national natural disasters, it is necessary to provide taxation facility in the form of the exemption from Value Added Tax on acquisition of buildings;
c. that having regards sub-paragraphsub-paragraphs a and b as well as in order to implement the provision of Article 2 paragraph (1) of Government Regulation No. 146/2000 concerning the Import and/or Delivery of Certain Taxable Goods and/or Taxable Services Exempt from Value Added Tax as has already been amended by Government Regulation No. 38/2003, it is necessary to stipulate a regulation of the Minister of Finance concerning Definitions of Modest House, Very Modest House, Modest Flat, Worker Camp, Student and Pupil Dormitory as well as Other Housing of which the Delivery is exempt from Value Added Tax;
1. Law No. 8/1983 concerning Value Added Tax on Goods and Services and Sales Tax on Luxury Goods (Statute Book of the Republic of Indonesia No. 51/1983, Supplement to Statute Book of the Republic of Indonesia No. 3264) as has already amended several times and the latest by Law No. 18/2000 (Statute Book of the Republic of Indonesia No. 128/2000, Supplement to Statute Book of the Republic of Indonesia No. 3986);
2. Government Regulation No. 146/2000 concerning the Import and/or Delivery of Certain Taxable Goods and/or Taxable Services Exempt from Value Added Tax (Statute Book of the Republic of Indonesia No. 262/2000) as has already been amended by Government Regulation No. 38/2003 (Statute Book of the Republic of Indonesia No. 79/2003, Supplement to Statute Book of the Republic of Indonesia No. 4302);
3. Presidential Decree No. 20/P/2005;
4. Decree of the Minister of Finance No. 370/KMK.03/2003 concerning the Exemption from Value Added Tax on Delivery of Certain Taxable Goods and/or Provision of Certain Taxable Services;
THE REGULATION OF THE MINISTER OF FINANCE CONCERNING DEFINITIONS OF MODEST HOUSE, VERY MODEST HOUSE, MODEST FLAT, WORKER CAMP, STUDENT AND PUPIL DORMITORY AS WELL AS OTHER HOUSING OF WHICH THE DELIVERY IS EXEMPT FROM VALUE ADDED TAX
Delivery of Modest House, Very Modest House, Modest Flat, Worker Camp, Student and Pupil Dormitory as well as other housing shall be exempt from Value Added Tax.
(1) The modest house and very modest house exempt from Value Added Tax as described in Article 1 shall be Healthy Modest House (RS Sehat/RSH) and Growing Core House (RIT) acquired in cash or through subsidized or non-subsidized credit facility or sharia-based financing, which fulfills the following provisions:
(2) Included the modest house and very modest house exempt from Value Added Tax as intended in paragraph (1) shall be Healthy Modest House (RS Sehat/RSH) and Growing Core House (RIT) given up to bank in the framework of sharia-based financing, which comply with the following provisions:
The modest flat exempt from Value Added Tax as intended in Article 1 shall be story building built in an environment, used for residence, accompanied by bathroom/water closet and kitchen, whether uniting with residence units or separate from communal use, which is acquired in cash or through subsidized or non subsidized credit facility with the provision that:
The worker camp exempt from Value Added Tax as intended in Article shall be story or non-story modest building, which is built and financed by individuals or employee cooperatives as well as designated to non-permanent workers or informal workers belonging to the low income group with the agreed rent and not transferred in 5 (five) years as from the date of acquisition.
The student and pupil dormitory exempt from Value Added Tax as intended in Article 1 shall be story or non-story modest building, which is built and financed by universities or schools, individuals and/or regional governments as well as specifically designated to shelter of pupils or students, not transferred in 5 (five) years as from the date of acquisition.
The other housing exempt from Value Added Tax as described in Article 1 shall include:
(1) Delivery of modest house, very modest house, modest flat not complying with the provisions as described in Article 2 and Article 3, shall be subject to Value Added Tax.
(2) Unless developers, banks providing sharia-based financing or other entrepreneurs undertaking the delivery as intended in paragraph (1) collect Value Added Tax, they are subject to sanctions in accordance with the provisions of taxation legislation in force.
(3) In case of buyers of modest house, very modest house and modest flat not abiding by the1provision as described in Article 2 paragraph (1) sub-paragraph band Article 3 sub-paragraph d, the originally exempt Value Added Tax shall be re-paid by the beneficiaries in not later than one month as from the date when the provision as intended in paragraph (1) is not fulfilled.
(4) In case of the purchase of modest house, very modest house and modest flat by banks failing to meet the provision in Article 2 paragraph (2) sub-paragraph b and paragraph (3) sub-paragraph c, the originally exempt Value Added Tax shall be re-paid by the banks receiving the facility in not later than one month as from the date when the provision as intended in paragraph (1) is not fulfilled.
(5) Procedures for the imposition and payment of the sanctions as intended in paragraph (2) up to paragraph (4) shall be ruled in a regulation of the Director General of Taxation.
Further provisions needed for implementing this regulation shall be ruled by a regulation of the Director General of Taxation.
With the enforcement of this regulation, Decree of the Minister of Finance No. 524/KMK.03/2001 concerning Definitions of Modest House, Very Modest House, Modest Flat, Worker Camp, Student and Pupil Dormitory as well as Other Housing of which the Delivery is exempt from Value Added Tax as has already been amended several times and the latest by Regulation of the Minister of Finance No. 65/PMK.03/2005 shall be declared null and void.
(1) Treatment of Value Added Tax on Delivery of Modest House, Very Modest House and Modest Flat realized before January 1,2007 shall abide by the provisions in Decree of the Minister of Finance No. 524/KMK.03/2001 concerning Definitions of Modest House, Very Modest House, Modest Flat, Worker Camp, Student and Pupil Dormitory as well as Other Housing of which the Delivery is exempt from Value Added Tax as has already been amended several times and the latest by Regulation of the Minister of Finance No. 65/PMK.03/2005.
(2) The moment of delivery of the modest house, very modest house and modest flat as intended in paragraph (1) shall be the moment when the right to use or control the house is given up legally or actually to buyers.
The Regulation of the Minister of Finance shall come into force as from the date of stipulation and be retroactive to January 1, 2007.
For publish cognizance, the regulation shall be published in State Gazette of the Republic of Indonesia.
Stipulated in Jakarta
On April 11, 2007
THE MINISTER OF FINANCE,
signed
SRI MULYANI IFDRAWATI