E-commerce giant Amazon reportedly in talks with the local government to expand its business in Indonesia.
Indonesian Finance Minister Sri Mulyani Indrawati said she has been discussing with Amazon about local regulation on investment and taxes
“I am discussing with Amazon about their plan to enter Indonesia. I want to ensure they will comply with local regulation and ready to pay the taxes,” said Sri Mulyani, as quoted by Katadata.
She explained, Indonesia government has succeeded to force tech giant which operates in Indonesia such as Google, to pay the taxes. Sri wanted to do just the same with Amazon in the future.
Indonesia’s Tax Directorate General estimates Google Indonesia must pay around Rp 450 billion per year for the revenue assumption of Rp 1.6 trillion-Rp 1.7 trillion.
For Amazon, Indonesia is the second country to expand their business in Asia. Last November started to expand to Singapore with their e-commerce services, including Amazon Prime and Amazon Prime Now.
Amazon’s plan to enter Indonesia comes a bit late compared to its Chinese rival, Alibaba and Tencent. Alibaba has invested in Indonesian e-commerce unicorn Tokopedia, while Tencent invested in JD.com and Shopee.co.id.
Statista estimated south east e-commerce market will grow from US$ 6 billion in 2015 to US$ 88 billion in 2025.