Update on Indonesian valuation procedures for taxation purposes

Recently, the government introduced a regulation aimed at providing technical guidelines for valuation procedures for taxation purposes i.e., Minister of Finance Regulation Number 79 of 2023 on Valuation Procedures for Taxation Purposes (“PMK-79/2023”). The regulation is designed to ensure fairness and legal certainty in the valuation process related to taxation.
PMK-79/2023 outlines two primary objectives for valuations in taxation purposes. First, it aims to ascertain the value of land and building tax (PBB) objects for determining the selling value of such taxable objects. Second, it seeks to establish the value of tangible assets, intangible assets, and businesses.

PBB Assessment

Valuation of PBB objects can occur for the current fiscal year or the preceding fiscal year. Additionally, the valuation for PBB objects' value can be conducted through office valuation or field valuation. 
Office valuation involves analyzing data on PBB objects based on the Tax Object Notification (SPOP) submitted by taxpayers, intending to issue the Land and Building Tax Due Notification (SPPT) for PBB.
Field valuation, on the other hand, entails identifying, collecting, and analyzing data related to PBB objects for determining their value through different activities, such as supervision, examination, objection settlement, PBB reduction, preliminary evidence examination, and investigation. PMK-79/2023 specifies that the results of field research serve as the basis for calculating outstanding PBB in SPPT PBB during supervision, PBB Examination Decisions, PBB Objection Decisions, PBB Reduction Decisions, calculation of state losses during preliminary evidence examination, and calculation and recovery of state income losses during investigation.

Valuation for Tangible Assets, Intangible Assets, and Businesses

Similar to PBB valuation, the valuation of tangible assets, intangible assets, and businesses can be conducted through either office valuation or field valuation.
Both office valuation and field valuation play a role in tax audit, Mutual Agreement Procedures (MAP), Advance Price Agreements (APA), tax objection settlement, reduction or cancellation of the tax assessment, tax collection, preliminary evidence examination, and investigation within the taxation field.
Various types of tangible assets are subject to valuation for tax purposes, including land, buildings, machinery, equipment, installations, transportation equipment, heavy machinery, vehicles, building equipment and supplies, furniture, electronic equipment, medical equipment, laboratory equipment, utilities, communication equipment, communication devices, art, jewellery, and biological assets.
Intangible assets eligible for valuation for tax purposes include assets related to marketing, customer, art, company contract, technology, research and development, and goodwill.
Finally, the valuation to determine business value covers business entities, participation in open or closed companies, financial instruments in open or closed companies, and the fairness of accounting presented in financial statements.


The implementation of PMK-79/2023 marks a significant stride towards fostering equity and legal assurance in the realm of valuation for taxation purposes. The regulation meticulously outlines procedures for evaluating land and building tax objects, as well as tangible assets, intangible assets, and businesses. Through both office and field valuations, the government aims to ensure a transparent and just tax system, contributing to the overall effectiveness and integrity of the taxation framework. This regulatory initiative underscores the commitment to fair and consistent valuation for taxation purposes, thereby fortifying the foundation for a robust and equitable fiscal landscape.

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