Government Further Relaxes Income-Tax Deductions (Tax Holidays) for Pioneer Industries

Based on the instruction of the Coordinating Minister of Economic Affairs, the Indonesian Investment Coordinating Board (Badan Koordinasi Penanaman Modal– “ BKPM ”) has just issued Regulation No. 1 of 2019 on Details of the Pioneer Industry Business Sectors and Production Types Eligible for the Corporate Income-Tax Deduction Facility as Well as Guidelines and Procedures for the Granting of Corporate Income-Tax Deductions(“ Regulation 1/2019 ”). [1] The issuance of Regulation 1/2019 is in line with the various provisions which are set out under Regulation of the Minister of Finance No. 150/PMK.010/2018 on Corporate Income-Tax Deductions (“ Regulation 150/2018 ”). [2] These matters were previously addressed under Regulation of the BKPM No. 5 of 2018 (“ Previous Regulation ”), which has now been repealed and replaced. [3] Regulation 1/2019 addresses the following tax-holiday related matters: