VAT Free Public Transport Services - Directorate General (DG) of Taxation has decided not to impose Value Added Tax (VAT) on delivery of public transport services on the road using public transport along the motor vehicle with a number of vehicles with yellow base and black writings, including those that are chartered or leased.
This assertion is stated in the Circular Letter of the Director General of Taxation Number: SE-119/PJ/2010 dated 16 November 2010 concerning the treatment of value added tax (VAT) on delivery of public transport services on the road.
"The assertion regarding VAT-free criteria of service delivery by public transport on the road is intended to provide legal certainty for the provision of public transport services and also for the tax man. So that will not happen again different interpretations," said the Director of Counseling Services and Public Relations Directorate General of Taxation Iqbal Alamsjah in a press release received Legal, in Jakarta, Tuesday (23/11/2010).
Iqbal also stated that the provisions regarding the types of services that do not bear any more VAT are listed in Article 4A paragraph (3) letter j of Law No. 8 of 1983 concerning VAT and VAT BM as amended by Act No. 42 of 2009.
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