The Directorate General Of Taxes Calls All VAT-Free Books, Except For Legal Violations

Book (photo: Unsplash)

The Directorate General of Taxes (DGT) of the Ministry of Finance (Kemenkeu) stated that all books were exempt from the imposition of value added tax (VAT), except for books that violated the applicable law.

"In accordance with PMK Number 5/PMK.010/2020 it is stated that all books (both print and digital) are public textbooks that are VAT-free," said Director of Counseling, Services, and Public Relations of DGT Dwi Astuti quoting Antara.

He continued that this provision does not apply to books containing elements that are contrary to Pancasila; ethnicity, religion, race, and intergroup (SARA); pornography, and others.

As for categorizing a book containing these elements, it is necessary to go through a court process.

"Evidence of the content of these elements must go through a court decision. Thus, as long as there is no court decision, all VAT-free books," said Dwi.

In Article 1 PMK 5/2020, the book is defined as a written work and/or image work published in the form of a braided print or in the form of electronic publications that are published regularly.

Meanwhile, Article 2 details imports and/or submissions of books exempted from the imposition of VAT covering general textbooks, holy books, and religious textbooks.

One of the definitions of general textbooks in the regulation refers to Law Number 3 of 2017, with education books being books used in general education, vocational education, academic education, professional education, vocational education, religious education, and special education.

Another definition of general textbooks is general books that contain elements of education. PMK 5/2020 explains that general books containing elements of education that are entitled to receive VAT exemption facilities are books that do not conflict with Pancasila; discriminatory based on ethnicity, religion, race, and/or intergroup (SARA); and contain pornography, violence, and hate speech.

Previously, in PMK 122/2013, books such as entertainment books, music, popular romance, magic, advertisements, promotion of a business, catalogs outside educational needs, caricatures, horoscopes, horrors, comics, and painting reproduction were not included in general textbooks. However, this rule died after the issuance of PMK 5/2020.