Digital transformation has introduced numerous benefits and changes to the way people work and conduct business. Paperless billing processes are becoming more common and digital a slew of solutions are emerging for every conceivable activity. Administrative procedures are now simpler and faster and physical signatures are being phased out in favour of electronic signatures.
In Indonesia, individuals, businesses, and other organisations must pay stamp duties on certain legal documents. Stamp duty is a one-time tax levied on civil documents and other documents used as evidence in legal proceedings. By law, the Indonesian government has recognised electronic documents as legal and, as such, that can be subject to stamp duty.
The Finance Minister of Indonesia unveiled an electronic seal with a nominal value of 10,000 rupiahs (US$0.70) per stamp that offers a legal guarantee for such electronic documents. According to the minister, the pandemic has accelerated the use of digital technology, including in no-paper transactions. The Director-General of taxation at the Ministry of Finance said electronic stamps are expected to ease public transactions.
We are forced by circumstances to make many transactions switch to digital platforms. Transactions with significant value require physical seals to be affixed to transaction documents, while digital transactions use electronic documents.
– Indonesian Finance Minister
The Indonesian finance ministry’s Directorate General of Taxes made the required technical preparations for stamp duty in one year, working with the state-owned banknote printer and mint to realise what is known as an e-seal or electronic seal. The government has appointed the company as the official manufacturer of electronic stamps in the Southeast Asian country.
The electronic stamps will be phased gradually in Indonesia, with the Ministry of Finance confirming that the first users will be state-owned banks. The Directorate General of Taxes and the stamp manufacturer will closely monitor the security of electronic stamps to prevent crimes such as counterfeiting.
The electronic seals are also predicted to boost state revenue, with the Indonesian finance ministry’s Directorate General of Taxes agency collaborating with the stamp manufacturer, the National Cyber and Crypto Agency (BSSN) and the finance and development supervisory agency BPKP to regulate their use.
E-stamps, as previously mentioned, provide opportunities and convenience for the public to carry out their tax obligations, particularly in civil transactions involving two parties and documents subject to stamp duty. The state-owned Bank Negara Indonesia (BNI) has expressed support for the use of electronic seals on electronic documents as one step toward achieving digital transformation.
“The application of electronic seals on electronic documents is a concrete manifestation of the digital transformation that is also being carried out by BNI,” the bank’s director for small and medium-sized businesses said in a statement. He added that as a state-owned bank, BNI has been committed to using electronic seals within the BNI group to support digital financial transactions in Indonesia.
In the coming years, e-stamps will be used in a variety of public electronic transactions that fall under the purview of the stamp duty regime. He claims that the e-stamp application will provide legal certainty for electronic documents while also optimising state revenues at current stamp duty rates.
To carry out electronic stamping, the government earlier passed Finance Minister Regulations Nos. 133 and 134, which will become effective on October 1, 2021. These two regulations are a continuation of the Stamp Duty Law, which is governed by Government Regulation No. 86 of 2021. The Law establishes a standard tax rate of 10,000 rupiahs (US$0.70) and a new electronic stamp duty system.
