Many MSMEs Still Unclear on Tax Reporting Mechanisms

The Chairperson of the Indonesian MSME Association (Akumandiri), Hermawati Setyorinny, has stated that many micro, small, and medium enterprise (MSME) actors still do not understand the procedures for tax collection and reporting. Consequently, Akumandiri is proposing the provision of education and outreach regarding tax payments and related technical policies through marketplace platforms.

The government plans to implement a mechanism for collecting Income Tax Article 22 (PPh 22) through marketplace platforms starting in July 2026. This provision is regulated in the Minister of Finance Regulation (PMK) Number 37 of 2025 concerning the Appointment of Other Parties as Income Tax Collectors and the Procedures for Collection, Deposit, and Reporting of Income Tax on Income Received or Earned by Domestic Traders through Electronic Commerce (PMSE).

Under this regulation, PMSE operators or marketplaces are appointed as the parties responsible for collecting income tax on the earnings of domestic traders selling through digital platforms.

Hermawati noted that MSME actors are still questioning the mechanism for tax collection via marketplaces. She emphasised that tax obligations fall under the authority of the tax office, while the marketplace serves as a platform connecting sellers and buyers. “There needs to be outreach and education,” Hermawati said when contacted on Sunday, 28 June 2026.

She assessed that business actors require a more detailed explanation regarding the collection mechanism, including tax crediting procedures and the treatment for businesses whose turnover has not yet reached the taxable threshold. She stressed that outreach must be conducted immediately, as MSME actors have not yet received adequate explanation regarding the policy’s implementation.

According to Hermawati, the government also needs to involve marketplace operators in educating sellers so that the policy implementation can proceed more smoothly. She stated that this outreach should not only target established businesses but also micro and small enterprises that are just beginning to utilise digital platforms for marketing.

She added that this new taxation policy must be accompanied by assistance to prevent it from causing concern among business actors.