Kupang City Government: NIB Registration Not Linked to Tax Collection

The Kupang City Government, East Nusa Tenggara, has emphasised that the process of obtaining a Business Identification Number (NIB) is not linked to tax collection, urging business actors not to worry about securing legal status for their enterprises. Secretary of the Kupang City Investment and One-Stop Integrated Service Office (DPMPTSP), Penina Lauata, stated on Monday that there is still a perception among business actors that possessing an NIB automatically subjects them to taxation. “Our field findings often show that business actors are afraid to apply for an NIB because they worry they will be immediately taxed. In fact, obtaining an NIB is not subject to tax,” she said. She explained that the object of taxation is income, not the amount of business capital stated in the NIB. “The capital value is only used to describe the business actor’s capacity to run and develop their business, so it does not serve as a basis for taxation,” she added. Therefore, she continued, business actors need not worry about stating their capital value when applying for an NIB, as this data is not used as a basis for determining taxes. Penina also noted that the government still provides various tax facilities for micro, small, and medium enterprises (MSMEs). MSMEs are only taxed if their annual turnover exceeds Rp500 million, while those with a turnover between Rp500 million and Rp4.8 billion per year are subject to a final income tax of 0.5 percent in accordance with applicable regulations. “Owning an NIB does not automatically make a business actor subject to tax. Tax is imposed based on income or turnover according to prevailing tax regulations,” she stated. Furthermore, the Kupang City Government recorded that from 1 January to 28 June 2026, a total of 1,573 NIBs were issued to business actors registered through the Online Single Submission (OSS) system. Of these, 1,565 NIBs, or 99.5 percent, were for micro and small enterprises, while eight NIBs, or 0.5 percent, were for non-micro and small enterprises. Penina stressed that NIB registration through the OSS system is a free service with no administrative fees. She added that the Kupang City DPMPTSP also provides NIB registration assistance services every working day through the Public Service Mall at the DPMPTSP office. Additionally, the Public Service Mall service is available on weekends through outreach activities during Car Free Day events at El Tari Kupang and Saboak at Taman Nostalgia Kupang. “Through these services, the City Government conducts direct education to the public as well as consultations on NIB registration,” she said.