The start of 2025 brings with it notable changes in how Value Added Tax (VAT) is calculated for specific industries in Indonesia, particularly those involved in the selling of gold, jewellery, and used motor vehicles. These adjustments have significant implications for businesses, especially small and medium enterprises (SMEs), individual sellers, and online resellers. Understanding the nuances of these VAT modifications is crucial not only to maintain compliance but also to optimize tax planning and profitability.
This article will guide you through the key VAT changes introduced in 2025 and how they affect your business if you deal in gold, jewellery, or used vehicles. We’ll break down the revisions, offer practical examples, and help you understand how CPT Corporate’s Tax Services can support your VAT obligations.
What Changed in the 2025 VAT Regulation?
VAT for Gold and Jewellery: From Flat Rate to Real Taxation
Prior to 2025, the sale of gold jewellery was subject to a simplified VAT mechanism. Many sellers enjoyed a deemed VAT approach, which often involved paying a fixed percentage regardless of the actual profit margin. However, in 2025, the Directorate General of Taxes (DGT) has shifted to a real taxation model.
What does this mean?
- Sellers must now calculate VAT based on the actual selling price minus the cost of goods sold (COGS), then apply the prevailing VAT rate.
- This change aligns the jewellery industry with general VAT rules, enhancing fairness but increasing the administrative burden.
Example: If a jeweller sells a necklace for IDR 10 million with a COGS of IDR 7 million, the VAT is now calculated on the IDR 3 million margin, not the total sale price as before.
VAT for Used Cars: Shifting Towards Margin-Based VAT
Selling used cars, whether through showrooms or individual listings, has also seen major VAT restructuring in 2025. Previously, VAT was charged on the full sale price, discouraging transactions and leading to informal sales.
Now, VAT is applied only on the value-added portion or margin. This makes it more equitable for used car dealers and reduces tax avoidance.
Key highlights:
- Only dealers registered as taxable entrepreneurs (PKP) can charge and claim VAT.
- The margin is defined as the difference between selling and purchase price.
Example: A used car bought for IDR 120 million and sold for IDR 150 million will attract VAT only on the IDR 30 million margin.
VAT for Gold Bars Remains Consistent
Interestingly, the VAT structure for gold bars (logam mulia) remains largely the same in 2025, still treated as a strategic commodity. Transactions are subject to 0% VAT under specific conditions, especially if purchased for investment purposes.
This unchanged status may give rise to tax planning strategies by those trading in both gold bars and jewellery.
Implications for Sellers
Increased Documentation
Sellers must now maintain accurate and detailed records of purchase costs, sales, and margins to comply with the new regulations. For jewellery and used car sellers, this might require additional accounting or digital tools.
Greater Need for Tax Consultation
Because VAT is now more closely tied to actual margins, businesses should regularly consult with tax professionals to avoid errors that could lead to audits or penalties.
Opportunity for Digital Sellers
Online platforms that facilitate the sale of used goods must ensure their users are informed and compliant. Marketplaces may also need to adapt their systems to help sellers calculate VAT accurately.
Common Challenges and Solutions
Challenge: Determining COGS Accurately
Solution: Adopt digital inventory and accounting systems that automatically track COGS per item.
Challenge: Margin Fluctuation and VAT Estimates
Solution: Work with a tax advisor to set estimated VAT thresholds and prepare for variable cash flow needs.
Challenge: Understanding VAT Exemptions and Zero-Rated Items
Solution: Keep updated with government regulations and seek professional advice to properly classify products.
Key Benefits of the 2025 VAT Changes
Despite the additional complexity, the new VAT rules have some advantages:
- Fairer taxation: VAT is now proportional to profit, reducing the tax burden for low-margin sellers.
- Encourages formalization: Sellers are more inclined to register as PKP to claim input tax credits.
- Promotes transparency: With detailed invoices and reporting, consumer trust may increase.
What Should You Do Next?
If your business deals with gold jewellery or used cars, here are steps to take:
- Evaluate your pricing model – ensure it reflects your actual margins and tax obligations.
- Upgrade your accounting system – incorporate margin-based VAT calculation capabilities.
- Consult with tax professionals – particularly when dealing with high-value or volume transactions.
- Register as PKP (if not already) – this allows you to charge and claim VAT properly.
Conclusion
The 2025 VAT regulation changes for gold, jewellery, and used cars mark a significant shift toward a margin-based tax system that promotes equity and transparency. While the transition may pose some administrative challenges, it also opens opportunities for better business practices and improved tax compliance. Staying informed and adapting your operations are key to leveraging these changes for long-term success.
CPT Corporate is here to assist you. Our Tax Services are designed to support businesses of all sizes with the latest regulatory updates. Whether you’re recalculating VAT, managing invoices, or registering as a taxable entrepreneur (PKP), our experts will guide you every step of the way. Let CPT Corporate help you stay compliant and maximize your profits. Contact us today to learn more about our tailored tax solutions.
