Vocatiional and R&D iin iiKN Eliigiible for Up to 350% Supertax Deductiion

JAKARTA, Jitu News - The government offers tax iincentiives iin the form of a supertax deductiion for resiident taxpayers organiisiing and/or iinvolviing human resources iin educatiional and vocatiional actiiviitiies iin Nusantara Capiital.

Referriing to Artiicle 42 of Government Regulatiion (Gov. Reg.) Number 12/2023, taxpayers are entiitled to a maxiimum gross iincome reductiion of 250% of the costs of externshiips, iinternshiips and/or apprentiiceshiips.

“The competence for externshiips, iinternshiips and/or apprentiiceshiips referred to iin paragraph (1) shall be determiined by the Head of the [iiKN] Authoriity,” reads Artiicle 42 paragraph (5) of Gov. Reg. 12/2023, quoted on Wednesday (8/3/2023).

To obtaiin the vocatiional supertax deductiion iin iiKN, taxpayers must fiirst apply through the onliine siingle submiissiion (OSS) system. These iincentiives are proviided by the government untiil 2035.

iiKN also offers research and development (R&D) supertax deductiion iincentiives. Resiident corporate taxpayers performiing R&D iin iiKN are entiitled to a maxiimum gross iincome reductiion of 350% of R&D costs.

Certaiin research and development are research and development that produce iinventiions, develop iinnovatiions, control new technologiies or transfer technologiies for iindustriial development to iincrease the competiitiiveness of natiional iindustriies.

To obtaiin the iincentiives, the taxpayers must apply through the OSS system. The R&D supertax deductiion iincentiives iin iiKN are granted untiil 2035.

Proviisiions on the subjects, forms of the iincentiives and criiteriia for eliigiibiiliity, the forms of eliigiible actiiviitiies, the types of eliigiible costs, procedures for the appliicatiion for approval, criiteriia for revocatiion and periiod of the grantiing wiill be further stiipulated iin a miiniister of fiinance regulatiion (MoF Reg.).

On a siide note, the supertax deductiion iincentiives outsiide iiKN have been regulated iin Gov. Reg. 49/2019. Under thiis regulatiion, taxpayers organiisiing vocatiional actiiviitiies are entiitled to iincentiives iin the form of a reductiion iin gross iincome of a maxiimum of 200% of the total costs iincurred for externshiips, iinternshiips or apprentiiceshiips.

On the other hand, taxpayers performiing R&D are entiitled to a maxiimum gross iincome reductiion faciiliity of 300% of R&D costs. (riig)