The dispute over PPh Article 23 withholding on freight forwarding services is back in the spotlight in the case between PT AM and the Directorate General of Taxes (DGT). The core conflict centers on the interpretation of Article 23 of the Income Tax Law and PMK-141/PMK.03/2015 regarding the definition of "Gross Amount" as the tax base. The Respondent (DGT) applied a correction, arguing that the entire invoice value was a taxable object due to the lack of clear separation between service fees and third-party costs in the billing documents. Conversely, the Taxpayer (WP) insisted that the value was a pure reimbursement without mark-up, supported by third-party invoices.
In its legal considerations, the Board of Judges emphasized that the essence of taxation on third-party services must refer to material evidence. The Judges conducted an in-depth evidentiary test on sampled billing documents. The legal resolution adopted was to partially accept the Taxpayer's arguments: transactions supported by third-party invoices whose values and details were identical to the charges to the customer were declared not to be objects of PPh 23. However, for invoices without adequate support or where there were value discrepancies, the Respondent's correction was upheld.
The impact analysis of this decision confirms that administrative compliance in the form of synchronized documentation between vendor invoices and customer invoices is non-negotiable for logistics companies. This ruling provides legal certainty that pure reimbursement is indeed excluded from PPh 23, but the burden of proof rests entirely on the Taxpayer to provide a perfect audit trail.
Key Conclusion: Logistics companies must tighten standard operating procedures in billing. To avoid gross-up corrections, third-party invoices must be perfectly matched in value and detail with the final bill issued to customers.
A Comprehensive Analysis and the Tax Court Decision on This Dispute Are Available Here
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