Scope and Objects of the Imposition of Stamp Duty

REFERRING to the provisions under Article 1 paragraph (1) of Law Number 10 of 2020 concerning Stamp Duty (Law 10/2020), stamp duty refers to a tax on documents. The next question is, however, what documents are subject to and not subject to stamp duty?

Documents that fall within the scope of stamp duty are documents relating to legal actions. These documents generally include documents used to transfer ownership. In further detail, the documents included as objects of stamp duty are regulated under Article 3 of Law 10/2020.

Pursuant to Article 3 of Law 10/2020, the types of objects that can be subject to stamp duty include documents prepared as a tool to explain a civil incident, namely an incident that falls within the scope of civil law concerning people, goods, engagements, evidence and expiration.

In further detail, the documents include first, agreement letters, certificates, statement letters or other similar letters, namely letters that are similar to statement letters, among others, power of attorney, grant deed and will. Each such letter must also be attached with the copies thereof which include the unit of the number of documents.

Second, notarial deeds and the tenor, copy and extract thereof. Third, conveyancer deeds and the copy and extract thereof.

Fourth, securities in whatever name and form, such as shares, bonds, cheques, checking/current accounts, banker’s acceptance, drafts, financial certificates, debentures, warrants, options, deposits and the like, including collective stock certificates or a group of other securities.

Fifth, documents of securities transactions, including documents of futures contract transactions, in whatever name and form. Documents of securities transactions refer to, among others, proof of transfer of securities transactions conducted on the stock exchange or proof of other transfer of securities transactions in whatever name and form.

The documents also include documents in the form of notarial deeds, receipts or other documents, used as proof of transfer of securities transactions conducted outside the stock exchange.

Documents of futures contract transactions include evidence of transfers of commodity futures contracts and stock futures contracts in whatever name and form, either those conducted on the stock exchange or futures exchange.

Sixth, auction documents in the form of extract of auction report, minutes of auction report, copy of auction report and tenor of auction report.

Seventh, documents stating an amount of money with a nominal value exceeding IDR5,000,000.00 which state the receipt of money or contain an acknowledgment that the debt has been fully or partially settled or taken into account. Eighth, other Documents stipulated by a government regulation.

In addition to the above civil documents, pursuant to Article 3 of Law 10/2020, stamp duty is also imposed on documents used as evidence in court. The said documents are documents subject to stamp duty payable that has not been paid in full, including documents on which stamp duty has not been paid in full, but have expired.

Moreover, the documents also include documents that were previously not subject to stamp duty because they are not included in the definition of stamp duty objects pursuant to the provisions under Article 3. Both types of documents must first be subject to ‘post-dated stamp duty’ when they are to be used as evidence in court.

This implies that pursuant to the provisions, documents may change into evidentiary documents in court. This is because the function of the documents switches as they are used for a different purpose from the purpose at the time the Documents were prepared.

On the other hand, for documents constituting objects of stamp duty on which the stamp duty has been paid, ‘post-dated stamp duty’ is no longer compulsory when used as evidentiary Documents in court. (faiz)*