Transaction Classification Disputes on Printing and Courier Services Under Article 23: PT PL Case Study

The tax dispute involving PT PL highlights the complexity of classifying transactions between the purchase of goods and technical or printing services under the Article 23 Income Tax scheme. The core conflict began when the Respondent (Tax Office) made corrections to the cost of purchasing sticker labels, which were deemed to contain elements of printing services (moulding), as well as courier service costs classified as expedition services. The Respondent stood firm on the expansion of other service objects in PMK 141/PMK.03/2015, which includes printing and land transportation services. Conversely, PT PL argued that the transactions were purely goods procurement where design or printing costs were inherent in the price and not separated in the invoice.

In Its Consideration the Board of Judges Provided a Resolution That Strengthened the Tax Authority Position

In its consideration, the Board of Judges provided a resolution that strengthened the tax authority's position regarding service classification. The Board opined that as long as the procurement contract contains clauses regarding printing services or the provision of designs, the transaction meets the criteria for printing services as regulated in Article 1 paragraph (6) letter ay of PMK 141/2015. Since PT PL did not separate the material value from the service value in the billing, the entire gross value became the tax base for Article 23 Income Tax. Similarly, courier services were deemed to have the same substance as expedition services. The implication of this decision emphasizes the importance of rigidly separating contract values between goods procurement and service delivery to minimize tax risks.