Indonesia nowadays are facing a global economic recession which have affected many countries include Indonesia. The Government of Indonesia are trying to prevent those kind of condition by stimulated the National Economic Growth through various program which expected to attract many investor especially foreign direct investment.
In accordance with the economic program, The Government of Indonesia have already review and amendment some regulation that indicated to be an obstacle in order to provide an attractive and sustainable investment climate. One of the regulation that regularly being in the spotlight are related with expatriate work permit.
Based on the press released from the Minister of Manpower, the official number of expatriate here in Indonesia in 2015 is around 70.000 workers and it is believe to be growing every year as result of foreign direct investment and globalization era.
Government of Indonesia have fully aware that complicated and inefficient expatriate regulation are one of the factor that could decrease nation competitiveness advantage.
Based on the fact as mentioned above the Government of Indonesia trough Ministry of Manpower has issued a Minister Regulation No. 16 of 2015 (PERMENAKER 16/2015) on Regulation And Procedure For Expatriate Utilization with addition and amendment on Minister Regulation No.35 of 2015 on Regulation And Procedure For Expatriate Utilization (PERMENAKER 35/2015).
What is the definition of expatriate according to Indonesian Law ?
Article 1 (13) Law No.13 of 2003 on Manpower define Foreign Workers (Expatriate) as “foreign citizen which obtain Indonesian working visa with the intention to work in Indonesia”.
Based on the definition mentioned above, we could see theirs a specific criteria for foreign citizen that came to Indonesia and to be called as expatriate.
Expatriate Work Permit Extension
There are positive changes in the PERMENAKER 35/2015 which consider to be more “Investment Friendly” and designed to shorten the process in the expatriate permit application, The most recognized amendment since it is widely reported in the national media is the dismissal of the obligation for expatriate to be able to communicate in Bahasa Indonesia and the amendment for expatriate in a Director or Commissioner position that not lived nor domicile here in Indonesia are not obliged to held an Expatriate Working Permit Card (IMTA).
In the other hand, the regulation also mentioned some new requirement for expatriate especially for the work permit extension process.
One of the most interesting new requirement since the issuance of PERMENAKER 35/2015 is stated in the Article 36 (1) point (d) and (f) which mentioned “after 6 (six) months of their presence here in Indonesia, expatriate is obliged to enroll and obtained their individual Tax Payer Registration Number (NPWP) and National Social Security Program (BPJS) membership”.
Article 36 (3), (4) stated that NPWP and BPJS Membership are exceptional for expatriate only for this type of jobs:
For the above mentioned jobs type, it is exceptional because the validity of the work permit are variously apply only from 1 (one) month to maximum 6 (six) months, without any possibilities for work permit extension.
Further, if expatriate failed to fulfil or obtained the NPWP and BPJS Membership document, they cannot proceed their work permit extension, since it is become a mandatory requirement for work permit extension refer to PERMENAKER 35/2015.
The Government of Indonesia have a big concern in regards of the national economic growth and implement it into regulation which designed to brought a more friendly investment climate without abandoned the nation interest and program.
So if you’re an expatriate here in Indonesia and stayed for more than 6 (six) months, it is very important for you to obtained your personal NPWP and BPJS document in order to stay compliant with Indonesia law and regulation and eligible for processing your work permit extension later.
SMART Legal Consulting has an extensive experience in assisting company obtaining or extending their expatriate work permit, kindly call us for more details and inquiry.
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