Marketplace Withholding: What's New?
Starting 1 August 2026, Indonesia’s tax authorities changed how income tax is collected on transactions made by domestic online merchants on e-commerce platforms. Instead of sellers remitting taxes themselves, marketplaces (Tokopedia, Shopee, Lazada, Blibli) are now tasked to collect and remit Income Tax Article 22 at source.(pajak.go.id)
This isn't a new tax — it’s a change in who administers the collection. The seller’s tax liability remains, but marketplaces now function as withholding agents, simplifying compliance and helping standardize oversight. The regulation is under MoF Regulation No. 37/2025 concerning parties authorized to collect income tax via electronic trading systems.(pajak.go.id)
Implications for Digital Business & Compliance
For Online Merchants
- Revenues passed through platforms will have tax withheld before funds are transferred.
- Need to reclassify bookkeeping: maintain records showing amounts withheld vs amounts received to avoid mismatches in reporting.
- Review whether thresholds or exemptions apply (e.g. very small sellers vs larger ones). Marketplace terms may specify conditions.(pajak.go.id)
For Marketplaces
- Need system integration to automatically compute withholding, issue receipts/tax slips.
- Inventory of transactions and earnings needs to align with tax filings -- discrepancies may trigger audits or disputes. Regular reconciliations are essential.
For Tax Administrators
- Better visibility and traceability of online economic activity.
- Potential reduction in unreported income and collection gaps.
Actionable Advice
- Walk through sample transactions with your accountant to see differences in cash flow when taxes are withheld by platform vs self-reporting.
- Confirm whether your platform has announced how to obtain required documents (e.g. withholding slips). If not, reach out proactively.
- For registered entities (PT, PKP etc.), ensure that bookkeeping practices align: show both gross receipts and net after withholding. Use this to compute credits in annual filings.
Example Scenario
Suppose you sell products via Lazada putting up S$100,000 worth of gross revenue in August 2026:
- Under old regime: you report full revenue; compute PPh Article 22 or relevant tax yourself later.
- Under new regime: Lazada automatically withholds say 1% (rate depends on regulation) at point of transaction, remits to govt. You receive S$99,000, plus documentation of withheld S$1,000. When filing your tax return, you include gross revenue, compute tax, then claim credit for withheld amount. Net payable may be small or zero depending on deductions.
This shift reflects a global trend toward simplified compliance and automated tax collection in the digital economy. Merchants, platforms, and advisors all need to adjust processes to ensure accurate reporting and avoid surprises.