Taxes on property rentals

Taxes on property rentals

JAKARTA (JP): The government, through a finance minister
decree, has imposed final income taxes on property rentals in a
bid to increase its domestic revenues.

Finance Minister Decree No. 394/KMK.04/1996, dated June 5,
stipulates that a 6 percent final rent-income tax will be imposed
on corporate tax payers and a 10 percent final rent-income tax on
individual tax payers.

The decree, which is a follow-up to Government Ruling No.
29/1996, states that the percentage of the income taxes are
derived from the gross value of the rents, including service
charges and maintenance costs.

Rented properties subject to the final rent-income taxes
include land, houses, apartments, condominiums, office space,
retail space, house-office buildings, shop-house buildings,
warehouses and industrial buildings. (rid)