Bonded Warehouse in Indonesia: How Importers Can Benefit From It

Bonded warehouses have given many import/export entrepreneurs in Indonesia a breath of relief. But, what are its benefits?

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How importers can benefit from bonded warehouse in Indonesia

Bonded warehouses in Indonesia were introduced and are regulated by the government. Since then, import and even export entrepreneurs have preferred to use bonded warehouses instead of regular ones.

But, what are the benefits of bonded warehouses that have given import/export entrepreneurs a breath of relief? We will cover its benefits in this article.

How is a bonded warehouse different from a regular warehouse?

A bonded warehouse allows you to securely store imported goods and distribute goods for export, just like a regular warehouse. 

Yet, customs will not keep your goods if you have not fully paid your duties and taxes using a bonded warehouse. Bonded warehouse is a warehouse entirely under the supervision of the Directorate General of Customs and Excise. 

You can stock imported goods for a year. In addition, you can include activities before distributing the goods, such as:

  • Packing/repackaging
  • Sorting
  • Kitting
  • Packing
  • Tuning
  • Cutting

By doing such activities, as an importer, you can efficiently divide, mix, brand, label, and pack the goods. While stored in the bonded warehouse, your goods can be ready for suitable product marketing in Indonesia.

What are the types of bonded warehouses in Indonesia?

The following are the three types of bonded warehouses in Indonesia.

A bonded warehouse that supports industrial activities in Indonesia

This type of bonded warehouse hoards and provides imported goods to industrial companies. The companies include manufacturing, mining, heavy equipment, and petroleum service industries.

A bonded warehouse of a special distribution center for duty-free shops in Indonesia

This bonded warehouse is especially to hoard and distribute imported goods to duty-free shops in Indonesia.

A transit bonded warehouse

 A transit bonded warehouse functions to hoard and distribute goods to outside areas of customs.

How can importers benefit from bonded warehouses in Indonesia?

By getting special tax treatments

A bonded warehouse is a bonded zone. Hence, you will have special tax treatments such as exemption from VAT on goods and sales tax on luxury goods similar to a bonded zone. 

The goods free of VAT include raw materials and auxiliary materials from outside the customs for further processing. And include finished goods originating outside the customs area or other bonded zones which are entered into the warehouse to be combined or processed for export.

If you sell or distribute luxury goods, you will get an exemption from VAT and sales tax on luxury goods. It can save you a lot of money since the sales tax of luxury goods in Indonesia can start from 10% up to 125%.

By deferring import duty payments in Indonesia

Using a bonded warehouse, you can defer duty payments until the goods have been sold or distributed. Payments are due when the goods leave the bonded warehouse (customs area) and officially enter Indonesia.

It can significantly improve your cash flow since it means there will be no payments in advance. The deferred duty payments can save you between 25%-33% of the upfront cost of imported goods. 

By avoiding paying duty in Indonesia 

Other than deferring, you can avoid paying duty altogether. There are a few legal ways to avoid paying for duty using a bonded warehouse in Indonesia.

If your goods are in the bonded warehouse for longer than two years, you can avoid paying duty by destroying the unsold or leftover goods. But, you will need approval from the head of customs.

You can also avoid paying duty for the accidentally destroyed goods due to evaporation, shrinkage, or any force majeure. This means you will not lose money for goods you cannot sell.

Moreover, if you intend on exporting your imported goods, you will not pay for duty twice. You will not need to pay import duty since the bonded warehouse is in a bonded zone under customs surveillance.

By having a certainty of available goods

A bonded warehouse can secure and preserve the quality of your goods. Not only that, but it can also assure the availability of your goods in Indonesia.

You can always import goods, so you do not run out of stock in Indonesia’s market. Then, if you are unable to sell the goods, you can always export them back to the origin country without paying import duty.

By having ports within reach

Most bonded warehouses in Indonesia are conveniently located near ports and airports. It can reduce transport costs and time to deliver your goods. Moreover, it can reduce the possibility of damage to your goods.

Emerhub can help you find bonded warehouses for your goods in Indonesia’s strategic locations. The locations include but are not limited to Jakarta, Bali, and Balikpapan.

Requirements to use a bonded warehouse for a foreign import company

The general requirements for a foreign company (PT PMA) to use a bonded warehouse in Indonesia are below.

  • Deed of establishment
  • Company tax card (NPWP)
  • Articles of association 
  • Supporting documents that include the composition of the board of directors
  • Company domicile certificate
  • Certificate of company registration (TDP)
  • Record of investment registration/Principle Permit/Investment Permit (new/expansion/change) from BKPM or DPMPTSP
  • Company address
  • Business place permit (SITU)
  • Location permit
  • Environmental permits for companies that have UKL/UPL/ AMDAL
  • Import identification number (API) and customs identity number (NIK)
  • Last semester LPKM recording and receipt 
  • Employee skills development program (PPKP)

Besides foreign companies, foreign individuals can also import goods using a bonded warehouse. Fill in the form below for more information on bonded warehouses. 

Our professional consultants will happily assist you in finding a bonded warehouse, registration, and any inquiries on bonded warehouses in Indonesia. 

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