Indonesia Importer of Record at a Glance:
Importer of Record
- Certain kinds of telecommunications equipment fall under LARTAS – Indonesia’s restricted import list
- Shipments undergo customs inspection based on one of three lanes – green, yellow, and red
IT Shipping & Logistics
- Shipping and last-mile delivery may take longer due to Indonesia’s mountainous and island-dense geography
Importer of Record and Pre-Shipment Documentation
The Indonesian government, like many Southeast Asian countries, is very pro-business and is actively looking to improve its tech economy. Over the past ten years, the Indonesian government has actively introduced measures to encourage investment in the economy. Ironically, however, Indonesia’s complex import systems can make it difficult for foreign companies to get their infrastructure into the country.
Taxes and Costs
When importing into Indonesia you’ll need to be mindful of taxes and costs that may cause your overall import to be more expensive than in other locations. Customs processing fees tend to be higher in Indonesia than in other countries. Additionally, your Importer of Record provider will need to facilitate the payment of two main taxes:
- PPN Tax: This is Indonesia’s version of VAT tax. It averages about 10 percent. Whereas most countries have standardized VAT rates, Indonesia varies its VAT rate based on the goods or services.
- PPH22 Tax: This is an income tax withheld when importing certain consumer goods.
Inspection and Documentation
LARTAS is Indonesia’s list of restricted items. Items on this list may require extra documentation or inspection prior to import. A knowledgeable Importer of Record provider can help you determine which of your items are on this list, and help prepare for any delays that this may cause later in the customs clearance process. Telecommunications hardware may be on this list.
Additionally, Indonesia incorporates a “lane system” for product inspection. Customs organizes your shipment into a “lane” based on a combination of the import entity’s reputation, type of equipment being shipped, and customs officers’ discretions. The lane speeds go from green to red, green being the fastest, red being the slowest. Customs assigns your shipment to a lane of inspection upon arrival; stricter lanes of inspection may take more time or effort to process. However, an experienced Importer of Record provider should be able to navigate any issues that your shipment encounters.
IT Shipping & Logistics
International shipping to Indonesia’s ports and last-mile delivery tend to be the longest parts of the door-to-data center timeline. The limited amount of wide-bodied air freight into Indonesia may result in restricted capacity and is one of the reasons for longer timelines.
Because Indonesia is an island-dense and mountainous country, shipping outside of Jakarta can be complex and time-consuming. Shipping to other locations can rely on a combination of trucking, ferry service, and additional air freight. FGX is an expert in tackling these tasks and can help you navigate the customs process as well as the complex shipping process in Indonesia.
FGX manages all of our client’s shipments door-to-door (or door-to-data center). This case study showcases how we navigated IT logistics and importation into Indonesia at the time that it was written. Regulations and challenges are constantly changing and exact shipping requirements may have changed. To learn more about FGX and how our global shipping platform can help your company, reach out here.