Before explaining the PPnBM deductions, let’s first understand the term PPnBM itself. PPnBM is a tax imposed on goods classified as luxury to producers to produce or import goods in business activities. PPnBM is only charged once at the time of delivery of goods to the manufacturer.
An item is subject to PPnBM due to several considerations based on Article 5 of the Value Added Tax Law (VAT Law), namely:
– Fairness of tax burden between low-income consumers and high-income consumers.
– Control of consumption of luxury goods.
– Protection against small or traditional producers.
– Security of state revenue.
Then, what are the taxable goods that are classified as luxury? Here is the list:
– Non-essential goods.
– Goods consumed by certain people.
– Goods that are generally consumed by people with high incomes.
– Goods consumed to show social status.
For a known example, PPnBM is collected only once at the time of delivery by the manufacturer or producer of the luxury goods and imports of the luxury goods. Submissions at the next level will no longer be subject to PPnBM.
The PPnBM rates themselves vary, from the lowest 10% to the highest 200%. The difference in PPnBM rates itself is based on the grouping of luxury goods that are subject to PPnBM. The grouping of goods subject to PPnBM is based on the level of ability of a group of people who use the goods, in addition to being based on the use value of the goods for the community in general.
The goods subject to PPnBM also vary, which are divided into several groups, namely:
– Motorized vehicles, except ambulances, hearses, fire fighting vehicles, prisoners’ vehicles, public transportation, vehicles used for the benefit of the state.
– Luxury residential groups, such as luxury homes, apartments, condominiums, totan houses, and the like.
– Group of aircraft, except for state purposes or commercial air transportation.
– Hot air balloon group.
– Group of firearms and other firearms, except for state purposes.
– Luxury yacht groups, except for the interests of the state, public transportation, or tourism businesses.
Car PPnBM discount
Then, what is a car PPnBM discount? PPnBM 2022 discount is the government’s official discount program on Sales Tax on Luxury Goods (PPnBM) for the period 2022. Based on the Decree of the Minister of Industry (Kepmenperin) Number 852 of 2022 concerning Motorized Vehicles with Sales Tax on Luxury Goods on Delivery of Taxable Goods classified as Luxury to be borne by the Government for Fiscal Year 2022.
The PPnBM discount for new cars is given as a stimulus so that the national automotive market can recover from the impact of the Covid-19 pandemic. This policy was first made in 2021 and will continue in 2022, but with different conditions.
The number of PPnBM discount recipients this year is 16 models. This number is less than the previous year, which was 36 models. This is because the rules are also different from before, especially regarding the local purchase requirements for components which are increased by at least 60% to 80%.
The government has also implemented 2 categories of granting PPnBM 2022 discounts, namely:
– Cars under IDR 200,000,000 (included in the Low Cost Green Car (LCGC) program.
– A car with a price of Rp. 200,000,000 – Rp. 250,000,000.
There are 5 LCGC models and 11 car models with a price range of Rp. 200 million – Rp. 250 million which get PPnBM 2022 discounts. The 5 LCGC models are given PPnBM discounts in stages, namely 100% discount for January – March, 66 % discount for April – June , and 33 % discount for July – September.
The five LCGC models should be subject to the normal PPnBM tariff of 3%. However, during the discount period, the tariff will be 0% in January – March, 2% in April – June, and 1% in July – September.
Meanwhile, for new cars of IDR 200 million – IDR 250 million, 50% discount is given during January – March, then in the second quarter and so on, the PPnBM rate applies normally, which is 15% or is subject to a 7.5% tax rate. Of course, the PPnBM burden that is billed will also be adjusted according to the respective categories in the current PPnBM emission regulations.
Types of Cars Subject to PPnBM 2022 Discount
The types of LCGC cars that are subject to the 2022 PPnBM discount are as follows:
Daihatsu Ayla (85% local purchase)
Ayla 1.0 D MT MC
Ayla 1.0 D+ MT MC
Ayla 1.0 X MT MC
Ayla 1.0 X MT DLX MC
Ayla 1.0 X AT MC
Ayla 1.0 X AT DLX MC
Ayla 1.2 X MT MC
Ayla 1.2 X AT MC
Ayla 1.2 R MT MC
Ayla 1.2 R MT DLX MC
Ayla 1.2 R AT MC
Ayla 1.2 R AT DLX MC
Toyota Agya (85% local purchase)
Agya 1.2 G MT STD
Agya 1.2 G MT Sport
Agya 1.2 G AT STD
Agya 1.2 AT GR Sport
Daihatsu Sigra (85% local purchase)
Sigra 1.0 D MT MC
Sigra 1.0 M MT MC
Sigra 1.2 X MT MC
Sigra 1.2 X MT DLX MC
Sigra 1.2 X AT MC
Sigra 1.2 X AT DLX MC
Sigra 1.2 R MT MC
Sigra 1.2 R MT DLX MC
Sigra 1.2 R AT MC
Sigra 1.2 R AT DLX MC
Toyota Calya (85% local purchase)
Calya 1.2 E STD MT
Calya 1.2 E MT
Calya 1.2 G MT
Calya 1.2 G AT
Honda Brio Satya (91% local purchase)
Honda Brio Satya 1.2 S MT CKD
Honda Brio Satya 1.2 E MT CKD
Honda Brio Satya 1.2 E CVT CKD
Also Read: Legal Basis of PPnBM: Initial Provisions and Derivative Regulations
Meanwhile, below are cars 1,500 cc and below that can get a PPnBM discount, as follows:
Daihatsu Xenia (Local purchase 85.7%)
Xenia 1.3 M MT
Xenia 1.3 X MT
Xenia 1.3 X CVT
Xenia 1.3 R MT
Xenia 1.3 R MT ADS
Xenia 1.3 R MT SC
Xenia 1.3 R MT SC ADS
Xenia 1.3 R CVT
Xenia 1.3 R CVT ADS
Xenia 1.3 R CVT SC
Xenia 1.3 R CVT SC ADS
Xenia 1.5 R MT
Xenia 1.5 R MT ADS
Xenia 1.5 R MT SC
Xenia 1.5 R MT SC ADS
Toyota Avanza (Local purchase 82.4%)
Avanza 1.3 E MT
Avanza 1.3 E CVT
Avanza 1.5 G MT
Daihatsu Terios (88.4% local purchases)
Terios X MT IDS
Terios X MT DLX IDS
Terios X AT IDS
Terios X AT DLX IDS
Toyota Raize (80% local purchase)
1.2 G MT (One Tone)
1.2 G CVT (One Tone)
Daihatsu Rocky (Local purchase 80%)
Rocky 1.2 M MT
Rocky 1.2 M CVT
Rocky 1.2 X MT
Rocky 1.2 X MT ADS
Rocky 1.2 X CVT
Rocky 1.2 X CVT ADS
Rocky 1.0 R TC MT
Rocky 1.0 R TC MT SC
Rocky 1.0 R TC MT Two Tone
Rocky 1.0 R TC MT Two Tone SC
Mitsubishi Xpander (80.4% local purchase)
Xpander 1.5 GLS L 4×2 MT
Honda Brio RS (96% local purchase)
Brio RS 1.2 MT CKD
Brio RS 1.2 AT CKD
Honda Mobilio (85% local purchase)
Mobilio 1.5 EM CVT
Suzuki Ertiga (86.4% local purchase)
GA MT
GL MT
GL AT
GX MT
GX AT
Suzuki Ertiga Sport (86.4% local purchase)
GS MT
GS AT
Suzuki XL7 (85.2% local purchase)
GX MT
GL MT
GX AT
GL AT
In the non-LCGC model, incentives will be given in the first quarter with a PPnBM rate of 7.5%. The second quarter to the fourth quarter, 15% will be paid in full by the customer.