Luxury Car Tax in Indonesia 2024, Rates & Calculations

Friends intending to buy a luxury car? Do you already know the luxury car tax in Indonesia? Well, if not, it would be good to check out the complete review below!

Having a luxury car is a pride for automotive enthusiasts. By owning it, it seems to enhance social status in the eyes of society.

Owning a luxury car is certainly not just about being able to buy it. But you must also be ready to bear the luxury goods tax, namely the car. It is important for you to know that cars of this type and segment have a special tax burden, namely the Luxury Goods Sales Tax or PPnBM.

Types of Luxury Car Taxes in Indonesia

Luxury car tax in Indonesia consists of several types of taxes that must be paid by the owners of luxury vehicles. Here are the details about luxury car taxes in Indonesia:

1. Luxury Goods Sales Tax (PPnBM)
   • This tax can reach 125% of the 10% VAT, meaning if the 10% VAT is Rp10 million, then the PPnBM can reach Rp12.5 million.
2. Motor Vehicle Name Transfer Fee (BBNKB)
   • This tax is 10% of the car price. For example, if the car price is Rp13 billion, then the BBNKB is Rp1.3 billion.
3. Motor Vehicle Tax (PKB)
   • This tax is 1.5% of the car price. With a car price of Rp13 billion, the PKB is Rp195 million.
4. Mandatory Contribution to Road Traffic Accident Fund (SWDKLLJ)
   • This tax is Rp140 thousand per year.

So, what types of cars are subject to luxury goods tax? Several types of cars that are subject to luxury goods tax qualify as supercar models. Supercars are often identified with luxury cars that have aerodynamic designs and high-powered engines. These supercars can be driven at speeds of up to 320 kilometers per hour. In Indonesia, supercars are categorized based on engine capacity (3,000 to 5,000 cc).

Supercars also include completely built-up (CBU) imported cars. Therefore, the taxes imposed are not only the Luxury Goods Sales Tax (PPnBM) but also Article 22 Income Tax or import goods at 10 percent. In the supercar category, some well-known car manufacturers include Lamborghini, Ferrari, Porsche, and others. Then, SUVs to two-door sedans priced in the billions of Rupiah are also subject to luxury goods tax.

So, how much is the tax for Ferrari and Lamborghini cars? In Indonesia, the luxury goods tax is considered expensive. The Luxury Goods Sales Tax can reach 125 percent of the 10 percent VAT. Therefore, people who can afford to buy luxury cars can be assured of having above-average income. This is because the more expensive the car, the higher the tax burden.

Read Also: Features Sought When Modifying Audio Systems in Luxury Cars

Example of Luxury Car Tax Calculation

There are two luxury car tax regulations that must be paid by the owner, namely the Motor Vehicle Name Transfer Fee (BBNKB) and Motor Vehicle Tax (PKB) and luxury goods tax based on ownership. 

For BBN KB, the amount is 10 percent of the vehicle price. Meanwhile, PKB is 1.5 percent of the vehicle's selling value.

Let's take an example for the owner of a Lamborghini Aventador LP700 4 Roadster priced at Rp 13 billion. From this car price, the BBNKB is charged at Rp 1.3 billion. 

As for PKB, Rp 13 billion x 1.5% is Rp 195 million. Then there is an additional fee for the Mandatory Contribution to the Road Traffic Accident Fund (SWDKLLJ) of Rp 140 thousand. Thus, the total tax for the Lamborghini Aventador can be calculated as Rp 1.3 billion (BBN KB) + Rp 195 million (PKB) and SWDKLLJ Rp 140 thousand, which is Rp 1.495 billion. 

It should be noted that the luxury car tax is imposed by both the central and regional levels. At the central level, it consists of VAT and PPnBM collected at the time of purchasing luxury cars. Meanwhile, at the regional level, PKB and BBNKB are imposed.  Unless the 0 percent car tax relaxation is realized, then PKB and BBNKB will no longer be imposed.

This tax is imposed based on the selling value of the vehicle and the weight of road damage caused by the vehicle. The weight of the damage is calculated based on pressure, type of fuel, vehicle type, usage, and year of manufacture of the vehicle. 

Meanwhile, the PKB rate is set at a minimum of 1 percent and a maximum of 2 percent for the first ownership. For the second ownership and beyond, a progressive rate of 2 percent to 10 percent is imposed.

Considering the large amount of luxury car tax, car owners are urged to fulfill their obligations on time. Because there are many cases where luxury car owners face sanctions in the form of fines, blocking, or seizure of luxury cars.

Author: Dinno Baskoro