Import Facilities for Small- and Medium-Scale Enterprises

The Ministry of Finance (“Ministry”) has issued Regulation No. 177/PMK.04/2016 on Exemptions from Import-Duty, Value-Added-Tax and Value-Added Tax and Luxury-Goods Sales Tax for the Import of Goods and/or Materials and/or Machinery by Small- and Medium-Scale Industries for Export Purposes (“Regulation 177/2016”).Through Regulation 177/2016, the government is aiming to support the growth of small- and medium-scale enterprises (“SMEs”) by offering exemptions from import-duty, value-added tax (pajak pertambahan nilai– “PPN”) or value-added tax and luxury-goods sales tax (pajak pertambahan nilai dan pajak pernjualan atas barang mewah– “PPnBM”) through import facilities for the purposes of export (kemudahan impor tujuan ekspor– “KITE”). [1] In essence, Regulation 177/2016 encompasses provisions which address the following KITE-facility areas: