Major Win at Tax Court: How PT BDU Successfully Proven Direct Attribution of Input Tax Without Proportional Formulas

Tax Court Appeal Decision | PPN | Partially Granted

PUT-009224.16/2023/PP/M.XIVA Tahun 2025

Taxindo Prime Consulting
Tuesday, April 21, 2026 | 14:10 WIB

00:00

Optimized with Google Chrome

Major Win at Tax Court: How PT BDU Successfully Proven Direct Attribution of Input Tax Without Proportional Formulas

Direct Attribution vs. Proportional Calculation: Analyzing PT BDU's IDR 1.39 Billion VAT Victory

The Value Added Tax (VAT) dispute in the tobacco industry often triggers intense debate regarding the method of crediting Input Tax. According to Tax Court Decision Number PUT-009224.16/2023/PP/M.XIVA Year 2025, PT BDU successfully overturned the Respondent's correction of IDR 1.39 billion regarding Input Tax credits.

The Technical Conflict: Clash of Methodologies

The core of the conflict lies in whether a Taxpayer with mixed deliveries (VAT collected vs. VAT not collected) must use a generic ratio or can specifically attribute costs to each revenue stream. The technical positions of both stakeholders are contrasted below:

Category	Petitioner (PT BDU) Method	Respondent (DGT) Method
Approach	Direct Attribution: Specifically identifying which Input Tax belongs to which output stream from the start.	Proportional: Applying a flat pro-rata ratio across all Input Tax based on total aggregated sales.
Legal Basis	Article 9 paragraph (5) VAT Law.	Article 9 paragraph (6) VAT Law.

Judicial Resolution: Form B2 and B3 as Source Code Evidence

The Board of Judges stated that the Petitioner provided very strong and detailed evidence. Documents such as invoices and tax invoices proved that PT BDU consistently separated Input Tax into Form B3 (Cigarette distribution - non-creditable) and Form B2 (A&P services and VELO products - creditable).

Input Tax (Creditable) = (Taxable Sales ÷ Total Sales) × Total Input Tax

Status: Overruled (This formula is only applicable when Input Tax cannot be specifically attributed to a certain output)

Strategic Implications & Lessons Learned

This decision reinforces that as long as Taxpayers maintain orderly accounting administration, the direct attribution method must take precedence. Key administrative guidelines include:

Administrative Order: Orderly bookkeeping and authentic supporting evidence like invoices and receipts serve as the primary mechanism against presumptive tax adjustments.
Methodological Hierarchy: Direct attribution under paragraph 5 is the primary method; the proportional approach under paragraph 6 is strictly a fallback for when transactional tracing is impossible.
Precision in Reporting: Consistently segregating accounting data into Form B2 and Form B3 for VAT returns builds an undisputable audit trail that cannot be easily set aside by tax authorities.

A Comprehensive Analysis and the Tax Court Decision on This Dispute Are Available Here