Indonesia’s Crypto Tax Revenue Falls 63% in 2023
Indonesia’s Ministry of Finance reported a 62% drop in tax revenue from crypto in 2023, with total tax revenue of $31.7 million.
Crypto transactions are subject to dual taxation, a 0.1% income tax and a 0.11% value-added tax (VAT), and local crypto exchanges contribute around 0.04% to the national crypto bourse. Despite a 159% increase in bitcoin in 2023, Indonesia’s crypto tax revenue experienced a 51% decrease in transaction volumes.
Local exchanges have protested the high tax rates, proposing that crypto transactions should only be subject to income tax, not VAT. This comes as the Financial Services Authority prepares to regulate crypto from January 2025, aiming to classify crypto more as a security rather than a commodity.
The total taxes on crypto transactions often exceed trading fees, raising concerns about users switching to overseas or illegal exchanges for cheaper transactions.
(With inputs from Shikha Singh)
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