Indonesia VS Thailand Victory Through a Tax Perspective
Introduction
The rivalry between Indonesia and Thailand always draws attention, especially in sports and economics. But what if we looked at Indonesia’s “victory” over Thailand from a tax perspective? In this article, we will explore a comprehensive comparison of the tax systems of both nations, highlighting Indonesia’s recent advancements in policy, digital transformation, and tax compliance.
Understanding the Concept of Victory in Taxes
In this context, “victory” does not refer to competition in a literal sense but rather a comparative measure of how effective each country is in:
- Creating fair and efficient tax regulations
- Encouraging tax compliance without increasing burden
- Utilizing digital tools to improve services
- Increasing tax revenue to support national development
Comparing Indonesia and Thailand’s Tax Systems
Similar Structures, Different Directions
| Tax Aspect | Indonesia | Thailand |
|---|---|---|
| Main Taxes | Income Tax (PPh), VAT, Customs, Excise | Income Tax, VAT, Customs, Excise |
| VAT Rate | 11% (12% planned in 2025) | 7% (temporary) |
| Corporate Income Tax | 22% (as of 2024) | 20% |
| Tax-to-GDP Ratio | 61% compliance, tax-to-GDP ratio ~10.4% | Compliance estimated lower, tax-to-GDP ratio ~16.5% |
| Digital Reporting | DJP Online, e-Faktur, e-Bupot | Revenue Department e-Filing |
Indonesia’s Digital Leap
Indonesia has made significant strides in digitizing its tax ecosystem. Platforms like DJP Online, e-Faktur, and OSS (Online Single Submission) have made filing and compliance easier for individuals and businesses.
While Thailand introduced e-filing earlier, Indonesia’s integration and expansion of services have begun to outpace Thailand’s in terms of reach and user-friendliness.
Case Study: Tax Incentives for Multinational Enterprises
Indonesia: Super Deduction and Tax Holiday
- Super Deduction R&D: Up to 300% deduction on R&D expenses
- Tax Holiday: 100% corporate income tax exemption for 5–20 years for strategic investors
Thailand: Board of Investment (BOI) Incentives
Thailand offers similar incentives focused on tourism and special economic zones. However, Indonesia is gaining favor due to improved transparency and easier access to incentives, especially after streamlining through digital systems.
Latest Policies and Green Fiscal Approach
Indonesia’s Carbon Tax and Green Fiscal Reform
Indonesia has taken steps to introduce a carbon tax targeting coal-fired power plants as part of its broader environmental and fiscal reform agenda. This initiative positions Indonesia as a forward-thinking nation in ASEAN.
Thailand is still exploring similar regulations but has yet to implement them on a large scale.
Regulatory Reinforcement and Data-Driven Taxation
- Coretax 3.0: A new system based on AI and big data
- Third-party data use: Integration with banks, fintech, and e-commerce
- Automatic Exchange of Information (AEoI): Global cooperation to combat tax evasion
These advancements show Indonesia’s firm stance on improving compliance and broadening its tax base.
Practical Tips for Indonesian Taxpayers
- Use DJP Online for easy and transparent tax filing
- Stay updated with new regulations on pajak.go.id
- Check your eligibility for tax incentives (especially for SMEs and priority sectors)
- Maintain accurate and organized financial records
- Consult a licensed tax advisor for complex matters
Conclusion
The “victory” of Indonesia over Thailand in taxation is not about outcompeting but evolving faster in crucial areas such as digital transformation, policy reform, and environmental taxation. With continuous progress, Indonesia is emerging as a fiscal leader in the ASEAN region.
Now is the time for citizens and businesses to participate actively in this transformation by becoming informed, compliant, and forward-thinking taxpayers.