Shopee is one of the largest e-commerce platforms in Southeast Asia and has established branches in many countries and regions, including Indonesia. Indonesia is a developing country with a large population and rapid economic development. Therefore, in order to promote the development of local e-commerce, the government has also made a series of tax policies. Shopee’s tax policy in Indonesia has a great impact on the operation of the Shopee platform and the operations of suppliers. The following is the impact of Indonesian tax policies on Shopee and related measures on how to comply with tax policies.
1. Overview of Indonesia’s e-commerce tax policy.
The Indonesian government’s tax policies for e-commerce platforms mainly include two aspects: value-added tax and tariffs.
1. Value-added tax.
The Indonesian government stipulates that starting from April 1, 2018, companies that provide e-commerce transaction products or services containing valuable services need to pay value-added tax. In addition, for sellers, if they sell online in Indonesia and reach a certain amount, they need to pay VAT to the Indonesian government.
2. Tariffs.
In addition to value-added tax, e-commerce platforms also need to pay customs duties. Some countries have very high tariffs on e-commerce products. At this time, the tax policy introduced by the government can regulate e-commerce platforms, reduce some logistics costs, and increase the popularity and market sales of imported product brands.
2. The impact of Indonesia’s tax policy on Shopee.
1. Shopee’s self-operated business.
As an e-commerce platform, Shopee’s self-operated business (such as direct sales of its own branded goods) also needs to pay taxes in accordance with the Indonesian government’s value-added tax regulations. Shopee must strictly abide by tax policies under Indonesia’s business model, and also need to reasonably plan the use of funds, pay taxes while ensuring normal operations, and maintain user experience and quality.
2. Shopee merchants.
In addition to Shopee’s own business, merchants on the Shopee platform must also pay value-added tax in accordance with government regulations. The Shopee platform needs to provide merchants with reasonable and formal advice on Indonesian tax laws and policies so that merchants can better understand tax policies and comply with tax laws without affecting business operations.
3. How to comply with Indonesian tax policies.
1. Promote tax gift strategies and education.
Shopee can regularly notify sellers and consumers of information and requirements related to tax policies. Inform sellers through tax gift strategies and clear and easy-to-understand tax education, and achieve fairness in market operations through tax payment.
2. Accurately estimate costs.
The Shopee platform needs to accurately estimate its own revenue and expenses to bring tax costs within the budget to ensure normal profits and smooth operations.
3. Cooperate with government departments
Shopee can seek help and guidance from relevant government departments to understand tax policies in a timely manner so as to promptly modify the platform’s operating strategies and tax strategies. With the support of government departments, we can better implement and comply with tax policies.
4. How to sell defective products
If you have obsolete, returned, outdated or defective products, you can consider donating them to local charitable organizations to avoid unnecessary financial losses.
5. Manage merchant accounts
The Shopee platform needs to strictly review merchants to join the platform, and conduct business legality reviews in existing merchant accounts, and conduct inspections on merchants who do not comply with relevant regulations. Strict penalties and establish a safe and convenient platform ecosystem.
Indonesia’s tax policy has a great impact on Shopee, which is of great significance to ensuring tax compliance, stable platform operations, and improving user experience and seller reputation. Shopee needs to improve relevant measures to comply with them, actively cooperate with government department inspections, establish an image of legitimacy and integrity, and promptly remove merchants from the platform who do not comply with regulations to promote the healthy development of the platform ecosystem. In the post-epidemic era, concepts such as new retail and digitalization are surging, and e-commerce is developing rapidly. E-commerce platforms need to actively cooperate with policy adjustments.