New tax rates for Americans

JAKARTA (JP): The Directorate General of Taxes has set new income tax rates for American individuals or corporations operating in Indonesia.

The directorate general said over the weekend a 10 percent income tax rate would be applied to dividends accrued by American corporations controlling at least a 25 percent stake in a company incorporated in Indonesia.

As for dividends collected by American corporations having less than a 25 percent stake in a company here, they would be subject to 15 percent income tax. A tax rate of 15 percent also applies to individuals' incomes.

Meanwhile, the rate for branch office tax and royalties is set at 10 percent each. A 10 percent tax rate also applies to interest income.

The directorate general introduced the new income tax rates following the signing of a protocol amending the convention between the Indonesian and U.S. governments for the avoidance of double taxation in Washington on Dec. 23, 1996. (rid)