As another deregulation package is published by President Joko Widodo on the 22nd of October

2015 (making this the 5th instalment to the ongoing economic reforms), new and enticing incentives are

making their appearance. In this package, new tax incentives that will directly affect assets of companies

have been published in the form of decreased taxes on asset revaluations. The Ministry of Finance

Bambang PS Brodjonegoro has issued Regulation of the Minister of Finance (PMK) No. 191 / PMK.010 /

2015 on Revaluation of Fixed Assets for the purpose of taxation for the Application Proposed in 2015

and 2016.

Revaluation of asset is a feasible way of increasing the worth of the assets of a company, yet

often times companies in Indonesia opt out of doing so due to the heavy taxation that can occur due to

this action. In practice, a company who wishes to conduct a revaluation of their assets must obtain first

a valid revaluation from a public or expert appraiser. After obtaining such projected value, they must

then pay the income tax of said land, after said payment; their asset can then be declared as revaluated

with the new price, whether higher or lower.

As Article 1 of PMK No. 191/2015 states, that companies or individuals who conduct a

revaluation of their asset before 31st of December 2015 will be levied by an income tax of 3% (three

percent), while those who conduct a revaluation before 1 January 2016 will be levied by an income tax

of 4% (four percent) and companies who conduct a revaluation of asset from 1 July 2016 until 31

December 2016 will be levied with an income tax of only 6% (six percent).

The value of said asset as the result of the revaluation referred to in PMK No. 191/2015 is the

value of fixed assets set by the office of the public appraiser or expert appraiser who obtain a license

from the government. The public appraiser or expert appraiser previously mentioned must be an

appraiser who has obtained their license no later than 31 December 2016 for applications made since

the enactment of PMK No. 191/2015.

The discount of income tax does not apply to companies who have obtained a revaluation of a

fixed asset from an office of public appraiser or expert appraiser that has obtained a valid license from

the government and but pays their income tax in 2017.

This new regulation could be counted as a win-win solution for both the companies who

conduct revaluation and also the government. The companies who conduct revaluation will find a

sudden surge of increase in the value of their assets, all the while having to pay a minimum amount of

income tax for the revaluation, while the government will benefit greatly from the regulation, as

companies who in previous years have opted out of revaluation due to heavy tax levies will choose to

conduct revaluation, providing new income sources or in fact strengthening the previous income source

of the government via taxes on asset revaluation.