What Are Consignment Goods of Indonesian Migrant Workers (PMIs)?

Indonesian migrant workers (Pekerja Migran Indonesia, hereinafter referred to as PMI) constitute one of the contributors to state foreign exchange and play a major role in economic development. The government is, therefore, committed to providing ease of services for PMI.

The ease includes the exemption from import duty and taxes on imports (Pajak Dalam Rangka Impor, hereinafter referred to as PDRI) for PMIs. These incentives are expected to facilitate the flow of consignment goods of PMI.

The government provides these incentives through the Minister of Finance Regulation (MoF Reg.) No. 141/2023. The regulation, taking effect on 11 December 023, includes fiscal incentives and procedural relief for consignment goodsof PMI. As such, what are the consignment goods of PMI?

Consignment goods refer to goods sent through postal operators pursuant to statutory provisions in the postal sector. The said postal operators include the appointed postal operator (Pos Indonesia) and courier service company (commercial postal services).

On the other hand, consignment goods of PMI refer to consignment goods consigned by PMI and fulfil certain requirements, including goods that have been used and/or owned by PMI. The requirements that must be fulfilled for consignment goods of PMI are stipulated under Article 3 of MoF Reg. 141/2023.

Referring to Article 3 paragraph (1) of MoF Reg. 141/2023, the consignment goods of PMI must fulfil 5 requirements. First, consigned by PMIs who are working and domiciled outside the territory of the Republic of Indonesia. Second, household items and/or consumer goods. Third, not constituting excisable goods.

Fourth, not constituting mobile phones, handheld computers and/or tablet computers. Fifth, not for trading. Moreover, the consignment goods of PMI are packaged in packaging with a maximum length of 60 cm, width of 60 cm and height of 80 cm.

PMI under these provisions refers to any Indonesian citizen who conducts work for wages outside the territory of the Republic of Indonesia. MoF Reg. 141/2023 classifies PMIs into two types.

First, PMIs registered with the Indonesian Migrant Worker Protection Board (Badan Pelindungan Pekerja Migran Indonesia, hereinafter referred to as BP2MI). Second, PMIs other than those registered with BP2MI provided that they have a work contract that has been verified by representatives of the Indonesian government.

Consignment goods of PMI with a customs value of no more than FOB US$500 are eligible for the exemption from import duty, non-collection of VAT and STLGs as well as the exclusion from the collection of Import Article 22 Income Tax incentives.

These incentives are granted provided that the goods are consigned a maximum of 3 times in 1 year for PMIs registered with BP2MI, and a maximum of 1 time for PMIs other than those registered with BP2MI.

If the value of the consignment goods exceeds US$500, the difference is subject to an import duty at a rate of 7.5%. Moreover, the value exceeding the exemption threshold will also be subject to VAT and STLGs and Import Article 22 Income Tax.

Compared to the provisions on general consignment goods under MoF Reg. 96/2023 as last amended by MoF Reg. 111/2023, the exemption threshold is greater. The import duty exemption under MoF Reg. 96/2023 as last amended by MoF Reg. 111/2023 amounts to a maximum of FOB US$3 per consignment. (rig)