Restaurant Meal Tax Rates by Province

Restaurant tax is one of the important sources of revenue for local governments in Indonesia. This tax is imposed on the services provided by restaurants to consumers. However, many people still do not fully understand restaurant taxes, including the basis for their imposition, tax objects and subjects, differences from Value Added Tax (VAT), and the applicable rates in various provinces.

1. Restaurant Meal Tax

1.1 Understanding Restaurant Tax

Restaurant tax is a tax imposed on services provided by restaurants to consumers. These services include the provision of food and/or beverages consumed on-site or in other facilities owned by the restaurant. This tax falls under the category of local taxes managed by regional governments and serves as a source of local revenue.

According to Law No. 28 of 2009 on Regional Taxes and Levies, a restaurant is defined as a facility providing food and/or beverages for a fee, including cafes, bars, eateries, canteens, and catering services.

1.2 Basis for Restaurant Tax Imposition

The basis for restaurant tax imposition is the total payment made by consumers to the restaurant for the services provided. This total includes the price of food and/or beverages as well as service charges, if applicable. In other words, restaurant tax is calculated based on the total bill paid by the consumer.

1.3 Tax Objects and Subjects

Tax Object:
 The objects of restaurant tax include all services provided by a restaurant, such as:

●      The provision of food and/or beverages consumed on-site.

●      The provision of food and/or beverages through catering services.

Tax Subject:
 The tax subject refers to individuals, groups, or entities that make payments for restaurant services. In this case, consumers who enjoy restaurant services are considered tax subjects.

Taxpayer:
 The taxpayer for restaurant tax is the business owner or restaurant operator who provides these services. They are responsible for collecting the tax from consumers and remitting it to the local government.

1.4 Differences Between VAT and Restaurant Tax

There is often confusion between Value Added Tax (VAT) and restaurant tax. Although both are consumption taxes, there are fundamental differences between them:

Type of Tax:

●      VAT: A central tax managed by the national government through the Directorate General of Taxes.

●      Restaurant Tax: A local tax managed by regional governments.

Tax Object:

●      VAT: Imposed on almost all goods and services consumed in Indonesia, except those exempted by law.

●      Restaurant Tax: Specifically imposed on services provided by restaurants, including the provision of food and/or beverages consumed on-site.

Tax Rate:

●      VAT: Since April 1, 2022, the VAT rate has been set at 11%.

●      Restaurant Tax: The maximum rate set by law is 10%, but the actual rate may vary by region based on local regulations.

It is important to note that food and beverages served in restaurants, hotels, and similar establishments are exempt from VAT. This is stipulated in Article 4A of the VAT Law in conjunction with the Tax Regulation Harmonization Law (HPP Law), which states that food and beverages served at such establishments are not subject to VAT. (pajak.go.id)

2. Restaurant Meal Tax Rates

2.1 Restaurant Meal Tax Rates by Province/City

Restaurant tax rates in Indonesia are determined by local governments through regional regulations. Although the law sets a maximum rate of 10%, some regions implement different rates based on local policies. Below are some examples of restaurant tax rates in various provinces/cities in Indonesia:

2.2 How to Calculate Restaurant Tax

Calculating restaurant tax is straightforward since it is based on the total payment made by consumers. The calculation formula is as follows:

Restaurant Tax Formula:
 Restaurant Tax = Restaurant Tax Rate × Total Bill

Example Calculation:
 A customer dines at a restaurant in Jakarta with a total bill of IDR 500,000. With a restaurant tax rate of 10%, the tax calculation is:

Restaurant Tax = 10% × IDR 500,000 = IDR 50,000

Thus, the total amount payable by the customer is:

Total Payment = Total Bill + Restaurant Tax
 = IDR 500,000 + IDR 50,000
 = IDR 550,000

If the restaurant also applies a service charge (e.g., 5%), the calculation becomes:

Service Charge = 5% × IDR 500,000 = IDR 25,000
 Restaurant Tax = 10% × (IDR 500,000 + IDR 25,000) = IDR 52,500
 Total Payment = IDR 500,000 + IDR 25,000 + IDR 52,500 = IDR 577,500

2.3 How to Pay Restaurant Tax (For Restaurant Owners)

For restaurant owners, the restaurant tax collected from customers must be remitted to the local government according to applicable regulations. Here are the steps for tax payment:

1. Business Registration

○      Register the business with the Regional Revenue Office (Dispenda) or Regional Tax Office (Bapenda) to obtain a Regional Taxpayer Identification Number (NPWPD).

2. Bookkeeping

○      Record all taxable transactions to ensure accurate tax calculation.

3. Filing and Payment

○      Submit a Regional Tax Notification Letter (SPTPD) monthly.

○      Remit the collected tax to the local treasury before the due date.

4. Tax Reporting

○      Report tax payments to the regional tax office within the designated schedule.

5. Penalties for Late Payments

○      Failure to pay on time may result in fines or sanctions per regional regulations.

By understanding restaurant tax, both customers and business owners can manage their finances better while complying with regulations.