Starting July 1, Purchasing Steam Games In Indonesia Will Be Subject To 10 Percent Tax

Steam logo (Steam doc.)

JAKARTA - Steam game distribution service, will collect a tax of 10 percent of every purchase by its users in Indonesia. This provision will take effect on July 1, 2020.

Quoted from Steam's partner website, Tuesday, June 23, this online game store platform made by Valve did not specify the reasons for the tax provisions. Apart from Indonesia, Germany and Saudi Arabia will also be subject to a tax of around 15 to 19 percent.

Withdrawal of regional taxes from Steam (screenshot)

In Indonesia itself, the government through the Directorate General (Ditjen) of Taxes, Ministry of Finance (Kemenkeu) has indeed planned to collect taxes on every purchase of digital products and services from merchants or organizers of Trade Through Electronic Systems (PMSE).

This provision is stated in the Minister of Finance Regulation (PMK) Number 48 / PMK.03 / 2020. Where, all purchases of digital products and services will be subject to a Value Added Tax (VAT) of 10 percent.

That means all Netflix, Spotify, and digital games streaming services will incur VAT. So services or digital goods originating from abroad or the customs area are considered the same as physical goods that are subject to tax.

Launching a press release from the Ministry of Finance, this policy is said to be part of the government's efforts to create justice and level playing field for all business actors, domestic and foreign, both conventional and digital.

Steam itself is a digital game distribution platform made by Valve which was released in 2003. In March 2020, the company formed by Gabe Newell even had 20 million active users around the world.

For gamers who have been buying games via Steam, they are already taxed. However, with the provision of tax collection, this of course will make the price of Steam games in Indonesia more expensive than usual.