Eligibility for MAP

Who can request for MAP?

• MAP can be requested by:

1. Tax Resident of Indonesia;
2. Indonesian Citizen (for non-discrimination issues);
3. Director-General of Taxes; or
4. The Competent Authority of the Treaty Partner.

• In this guidance, the term 'Applicant' refers to the Tax Resident of Indonesia and Indonesian Citizen.

What can be requested for MAP?

• Tax Resident of Indonesia may request for MAP to Director General of Taxes if it considers there is taxation that not in accordance with the provision of the tax treaty, i.e.:

1. Taxation by the tax administration of treaty partner resulting in double taxation due to:
   1. 1. transfer pricing adjustment;
      2. adjustment related to the existence and/or to the attribution of profit of Permanent Establishment;
      3. adjustment on other taxable profits
2. withholding tax in the country/jurisdiction of treaty partner which is considered not in accordance with the provisions of a tax treaty;
3. determination the status as resident Taxpayer by the tax administration of treaty partner (dual resident issue)
4. discrimination of tax treatment in the country/jurisdiction of the treaty partner;
5. interpretation of tax treaty provision.

• Indonesian Citizens may request for MAP through the Director-General of Taxes only on any discriminations in the country/jurisdiction of treaty partner which is considered not in accordance with the non-discrimination provisions of the tax treaty.
• Director-General of Taxes may request for MAP, among others, for the following issues:

1. preventing double taxation as a result of transfer pricing adjustment initiated by Director General of Taxes by proposing any corresponding adjustment on the taxable profit of treaty partner's Taxpayer;
2. following-up Bilateral Advance Pricing Agreement (BAPA) application of Indonesian Taxpayer, including the application of roll-back for the preceding years as referred to in the regulation concerning Advance Pricing Agreement;
3. interpreting the provisions of the tax treaty.

How MAP interacts with the Domestic Remedies?

• MAP initiated by Director General of Taxes and the Competent Authority of treaty partner can be requested in parallel with:

1. request for lawsuits as regulated in Article 23 of the General Provisions and Tax Procedures;
2. request for objections as regulated in Article 25 of the General Provisions and Tax Procedures;
3. request for appeals as regulated in Article 27 of Law on General Provisions and Tax Procedures;
4. request for the reduction or cancellation of incorrect tax assessment letter as regulated in Article 36 paragraph (1) subparagraph b of the General Provisions and Tax Procedure; or
5. request for judicial review as regulated in Article 77 paragraph (3) of Law on the Tax Court.

Rejection of MAP requests

In cases where it appears to the Indonesian CA that the Taxpayer's MAP request may be inadmissible or not justified, the Indonesian CA will write to the other CA setting out the reasons why the Indonesian CA believes the request is invalid and invite the other CA to provide its views before deciding to reject the request.