LAW OF THE REPUBLIC OF INDONESIA NUMBER 11 OF 2016 REGARDING TAX AMNESTY BY THE GRACE OF GOD THE ALMIGHTY THE PRESIDENT OF THE REPUBLIC OF INDONESIA,

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1 -1- UNOFFICIAL TRANSLATION LAW OF THE REPUBLIC OF INDONESIA NUMBER 11 OF 2016 REGARDING TAX AMNESTY BY THE GRACE OF GOD THE ALMIGHTY THE PRESIDENT OF THE REPUBLIC OF INDONESIA, Considering: a. whereas national development of the Republic of Indonesia which is intended to prosper all the people of Indonesia in equitable and fair manner need large funding which derives from tax revenue; b. whereas in order to fulfill the increasing tax revenue, public awareness and compliance is necessary by optimizing all existing potentials and resources; c. whereas public awareness and compliance in performing their tax obligations are necessary to be improved as there are Assets, both domestic and abroad, that have not been or have not been entirely reported in the Annual Income Tax Return; d. whereas to increase the state revenue and economic growth as well as public awareness and compliance in performing tax obligations, it is necessary to issue a Tax Amnesty policy; e. whereas based on the considerations as referred to in letter a up to letter d, it is necessary to enact a Law regarding Tax Amnesty; Observing: Article 5 paragraph (1), Article 20, and Article 23A of 1945

2 -2- Constitution of the Republic of Indonesia; Upon Joint Approval of THE HOUSE OF REPRSENTATIVES OF THE REPUBLIC OF INDONESIA and THE PRESIDENT OF THE REPUBLIC OF INDONESIA HAS DECIDED: To enact: LAW REGARDING TAX AMNESTY. CHAPTER I GENERAL PROVISIONS Article 1 In this law: 1. Tax Amnesty shall be elimination of tax that should have been payable, not being subject to tax administrative sanction and criminal sanctions in tax area by declaring Assets and paying tax redemption as regulated in this Law. 2. Taxpayer shall be an individual or corporate that has taxation rights and obligations based on the tax laws and regulations. 3. Assets shall be additional accumulation of economic capability in the form of all wealth, both tangible and intangible, both movable and immovable, both used for business and non-business, located within and/or beyond the area of the Republic of Indonesia. 4. Debt shall be the amount of principal liability that has not been paid which is directly related to the acquisition of assets.

3 -3-5. Fiscal year shall be a period of 1 (one) calendar year, except if Taxpayer uses accounting year that is different from the calendar year. 6. Tax Arrear shall be the amount of tax principal that has not been settled based on the Tax Collection Letter which contains the tax principal payable, Tax Underpayment Assessment Letter, Additional Tax Underpayment Assessment Letter, Statement of Correction, Objection Decision, Appeal Judgment, and Judicial Review Judgment, which causes the amount of tax payable to increase, including tax that should not have been returned, as regulated in General Taxation Provisions and Procedures Law. 7. Tax Redemption shall be an amount paid to the state treasury to obtain Tax Amnesty. 8. Tax crime shall be any criminal act as regulated in General Taxation Provisions and Procedures Law. 9. Asset Declaration Letter for Tax Amnesty, hereinafter referred to as Asset Declaration Letter, shall be a letter used by Taxpayer to declare his/her Assets, Debt, Amount of Net Assets, as well as calculation and payment of Tax Redemption. 10. Minister shall be the minister that holds governmental affairs in state finance area. 11. Clearance Letter for Tax Amnesty, hereinafter referred Clearance Letter, shall be a letter issued by the Minister as a proof of granting Tax Amnesty. 12. Last Annual Income Tax Return, hereinafter referred to as Last ITR, shall be: a. Income Tax Return for Fiscal Year 2015 for Taxpayer whose accounting year ends on July 1, 2015 up to December 31, 2015;

4 -4- b. Income Tax Return for Fiscal Year 2014 for Taxpayer whose accounting year ends on January 1, 2015 up to June 30, Data and Information Management shall be an administration system of Taxpayer s data and information related to Tax Amnesty, which is managed by Minister. 14. Designated Bank shall be a public bank appointed by Minister to receive state revenue payment and based on this Law, is appointed to receive payment of Tax Redemption and/or fund transferred to areas within the Republic of Indonesia for the implementation of Tax Amnesty. 15. Last Fiscal Year shall be the fiscal year ended in the period of January 1, 2015 up to December 31, CHAPTER II PRINCIPLES AND PURPOSES Article 2 (1) Tax amnesty is performed based on the principles of: a. legal certainty; b. fairness; c. benefit; and d. national interest. (2) The purposes of Tax Amnesty are to: a. accelerate economic growth and restructuring through transfer of Assets, which among others will impact to the increase in domestic liquidity, improvement of rupiah exchange rate, decrease in interest rate and increase in investment; b. support taxation reformation toward a fairer taxation system and expansion of taxation data

5 -5- basis that is more valid, comprehensive, and integrated; and c. increase tax revenue, which will be used among others for development funding. CHAPTER III SUBJECT AND OBJECT OF TAX AMNESTY Article 3 (1) Every Taxpayer shall have the right to obtain Tax Amnesty. (2) Tax Amnesty as referred to in paragraph (1) is granted to Taxpayer by declaring the Assets owned in Asset Declaration Letter. (3) The following Taxpayers shall be excluded from the provision as referred to in paragraph (1), if the Taxpayer: a. is under investigation and the investigation files have been stated as complete by the Public Prosecutor s Office; b. is under the judiciary proceedings; or c. is undergoing criminal penalties, for any Tax Crime. (4) Tax Amnesty as referred to in paragraph (1) includes amnesty upon taxation obligations that have not been or have not been entirely performed by Taxpayer. (5) Taxation obligations as referred to in paragraph (4) includes obligations of: a. Income Tax; and b. Value Added Tax or Sales Tax for Luxury Goods.

6 -6- CHAPTER IV TAX REDEMPTION RATE AND CALCULATION Article 4 (1) Tax Redemption rates upon Assets located within the areas of the Republic of Indonesia or Assets located beyond the areas of the Republic of Indonesia that are transferred to areas within the Republic of Indonesia and invested within the areas of the Republic of Indonesia for a period of at least 3 (three) years since the transfer, shall be: a. 2% (two percent) for Asset Declaration Letters submitted in the first month up to the end of the third month starting from the promulgation of this Law; b. 3% (three percent) for Asset Declaration Letters submitted in the fourth month starting from the promulgation of this Law up to December 31, 2016; and c. 5% (five percent) for Asset Declaration Letters submitted starting from January 1, 2017 up to March 31, (2) Tax Redemption rates upon Assets located beyond the areas of the Republic of Indonesia and not being transferred to areas within the Republic of Indonesia shall be: a. 4% (four percent) for Asset Declaration Letters submitted in the first month up to the end of the third month starting from the promulgation of this Law; b. 6% (six percent) for Asset Declaration Letters submitted in the fourth month starting from the promulgation of this Law up to December 31, 2016; and

7 -7- c. 10% (ten percent) for Asset Declaration Letters submitted starting from January 1, 2017 up to March 31, (3) Tax Redemption rate for Taxpayer whose turnover is up to IDR4,800,000,000 (four billion and eight hundred million rupiah) in the Last Fiscal Year shall be: a. 0.5% (zero point five percent) for Taxpayer who declares Assets up to IDR10,000,000,000 (ten billion rupiah) in the Asset Declaration Letter; or b. 2% (two percent) for Taxpayer who declares Assets more than IDR10,000,000,000 (ten billion rupiah) in the Asset Declaration Letter, for Asset Declaration Letters submitted in the first month starting from the promulgation of this Law up to March 31, Article 5 (1) The amount of Tax Redemption is calculated by multiplying the rate as referred to in Article 4 by the Tax Redemption imposition basis. (2) Tax Redemption imposition basis as referred to in paragraph (1) is calculated based on the amount of net Assets that have not been or have not been entirely reported in Last ITR. (3) Amount of Net Assets as referred to in paragraph (2) is the difference between the value of Assets minus the amount of Debt. Article 6 (1) Value of Assets declared in Asset Declaration Letter shall include:

8 -8- a. value of Assets that have been reported in Last ITR; and b. amount of additional Assets that have not been or have not been entirely reported in Last ITR. (2) Value of Assets that have been reported as referred to in paragraph (1) letter a shall be determined in Rupiah based on the amount reported in Last ITR. (3) In the event that Taxpayer is obliged to submit Annual Income Tax Return in a currency other than Rupiah, the value of Assets that have been reported as referred to in paragraph (1) letter shall be determined in Rupiah based on the foreign exchange rate stipulated by Minister for the purpose of tax calculation at the end date of accounting year in accordance with Last ITR. (4) Amount of additional Assets that have not been or have not been entirely reported as referred to in paragraph (1) letter b shall be determined in Rupiah based on the nominal value of Assets in the form of cash or fair value of Assets other than cash at the end of Last Fiscal Year. (5) In the event that the amount of additional Assets is in a currency other than Rupiah, the amount of additional assets shall be determined in Rupiah based on: a. nominal amount for Assets in the form of cash; or b. fair value at the end of Last Fiscal Year for Assets other than cash, by using the foreign exchange rate stipulated by Minister for the purpose of tax calculation at the end of Last Fiscal Year.

9 -9- Article 7 (1) Amount of Debt declared in Asset Declaration Letter includes: a. Amount of Debt that has been reported in Last ITR; and b. Amount of Debt related to the additional Assets as referred to in Article 6 paragraph (1) letter b. (2) For calculation of Tax Redemption imposition basis, the amount of Debt which is directly related to the acquisition of additional Assets that can be used as deduction of value of Assets for: a. Corporate Taxpayer shall be at the maximum of 75% (seventy five percent) of the amount of additional Assets; or b. Individual Taxpayer shall be at the maximum of 50% (fifty percent) of the amount of additional Assets. (3) Amount of Debt that has been reported as referred to in paragraph (1) letter a shall be determined in Rupiah based on the amount reported in Last ITR. (4) In the event that Taxpayer is obliged to submit Annual Income Tax Return in a currency other than Rupiah, the amount of Debt as referred to in paragraph (3) shall be determined in Rupiah based on the foreign exchange rate stipulated by Minister for the purpose of tax calculation at the end date of accounting year in accordance with Last ITR. (5) Amount of Debt related to the additional Assets as referred to in paragraph (1) letter b shall be determined in Rupiah based on the amount reported in the list of Debt at the end of Last Fiscal Year. (6) In the event that Debt related to the additional Assets as referred to in paragraph (1) letter b is determined in

10 -10- a currency other than Rupiah, the amount of Debt shall be determined in Rupiah based on the foreign exchange rate stipulated by Minister for the purpose of tax calculation at the end of Last Fiscal Year. CHAPTER V PROCEDURES FOR SUBMISSION OF ASSET DECLARATION LETTER, ISSUANCE OF CLEARANCE LETTER, AND AMNESTY UPON TAXATION OBLIGATIONS Article 8 (1) To obtain Tax Amnesty, Taxpayer must submit Asset Declaration Letter to Minister. (2) Asset Declaration Letter as referred to in paragraph (1) shall be signed by: a. individual Taxpayer; b. the highest corporate position based on the corporate deed of establishment or other equivalent documents, for corporate Taxpayer; or c. proxy, in the event that the highest corporate position as referred to in letter b is absent. (3) Taxpayer as referred to in paragraph (1) must satisfy the following requirements: a. having Tax Identification Number; b. paying Tax Redemption; c. settling any Tax Arrear; d. settling any tax that has not been paid or has been underpaid or settling any tax that should not have been returned for Taxpayer who is in the preliminary evidence tax audit and/or investigation; e. submitting Last ITR for Taxpayer who has already had an obligation to submit Annual Income Tax Return; and

11 -11- f. revoking applications for: 1. refund of tax overpayment; 2. reduction or elimination of taxation administrative sanction in Tax Assessment Letter and/or Tax Collection Letter which contains the principal tax payable; 3. reduction or cancellation of incorrect tax assessment; 4. objection; 5. revision of tax assessment letter and decision letter; 6. appeal; 7. lawsuit; and/or 8. judicial review, in the event that Taxpayer is submitting the application and no decision or judgment has been issued. (4) Tax Redemption as referred to in paragraph (3) letter b must be fully paid to the state treasury through Designated Bank. (5) Payment of Tax Redemption as referred to in paragraph (4) shall use Tax Payment Slip that functions as proof of payment of Tax Redemption after being validated. (6) In the event that Taxpayer is intended to transfer his/her Assets to areas within the Republic of Indonesia, besides satisfying the requirements as referred to in paragraph (3), Taxpayer must transfer the Assets to areas within the Republic of Indonesia and invest the said Assets in the areas within the Republic of Indonesia for a minimum period of 3 (three) years:

12 -12- a. before December 31, 2016 for Taxpayer who chooses to use Tax Redemption rate as referred to in Article 4 paragraph (1) letter a and letter b; and/or b. before March 31, 2017 for Taxpayer who chooses to use Tax Redemption rate as referred to in Article 4 paragraph (1) letter c. (7) In the event that Taxpayer declares Assets that are located and/or placed in areas within the Republic of Indonesia, besides satisfying the requirements as referred to in paragraph (3), Taxpayer cannot transfer Assets to areas beyond the Republic of Indonesia for a period of 3 (three) years starting from the issuance of the Clearance Letter. Article 9 (1) Asset Declaration Letter as referred to in Article 8 paragraph (1) shall contain at least information regarding Taxpayer s identity, Assets, Debt, amount of net Assets, and calculation of Tax Redemption. (2) Asset Declaration Letter as referred to in paragraph (1) must be attached with: a. proof of payment of Tax Redemption; b. proof of settlement Tax Arrear for Taxpayer who has Tax Arrear; c. list of detailed Assets and information of ownership of Assets that are reported; d. list of Debt and the supporting documents; g. proof of settlement of tax that is not paid or underpaid or tax that should not have been returned for Taxpayer who is in the preliminary evidence tax audit or investigation; e. photocopy of Last ITR; and

13 -13- f. a statement letter of revoking all applications as referred to in Article 8 paragraph (3) letter f. (3) In the event that Taxpayer is intended to transfer Assets to areas within the Republic of Indonesia as referred to in Article 8 paragraph (6), besides attaching the documents as referred to in paragraph (2), Taxpayer must attach a statement letter of transferring and investing Assets in areas within the Republic of Indonesia for a period of at least 3 (three) years after the transfer. (4) In the event that Taxpayer declares Assets that are located and/or placed in areas within the Republic of Indonesia as referred to in Article 8 paragraph (7), besides attaching documents as referred to in paragraph (2), Taxpayer must attach a statement letter of not transferring Assets to areas beyond the Republic of Indonesia for a period of at least 3 (three) years after the issuance of Clearance Letter. (5) For Taxpayer whose turnover is up to IDR4,800,000,000 (four billion and eight hundred million rupiah) in Last Fiscal Year as referred to in Article 4 paragraph (3), besides attaching the documents as referred to in paragraph (2) and paragraph (4), the said Taxpayer must attach a statement letter on the amount of turnover. Article 10 (1) Asset Declaration Letter shall be submitted to the Directorate General of Taxes office where Taxpayer is registered or other places determined by Minister. (2) Before submitting Asset Declaration Letter and its attachments as referred to in Article 9, Taxpayer shall request for explanations regarding the filling and

14 -14- completion of documents that must be attached with Asset Declaration Letter to Directorate General of Taxes office or other places determined by Minister. (3) Based on the explanations as referred to in paragraph (2), Taxpayer shall pay Tax Redemption and submit Asset Declaration Letter and its attachments. (4) Minister or the official appointed on behalf of Minister shall issue Clearance Letter within a maximum period of 10 (ten) working days since the date when the Asset Declaration Letter and its attachments are received and shall deliver the Clearance Letter to Taxpayer. (5) In the event that in 10 (ten) working days as referred to in paragraph (4), the Minister or the official appointed on behalf of Minister has not issued any Clearance Letter, the Asset Declaration Letter shall be deemed accepted as Clearance Letter. (6) Minister or the official appointed on behalf of Minister could issue correction letter on Clearance Letter in the event of: a. typographical error in the Clearance Letter; and/or b. miscalculation in the Clearance Letter. (7) Taxpayer may submit Asset Declaration Letter up to 3 (three) times at the most within a period starting from the promulgation of this Law up to March 31, (8) Taxpayer may submit the second or third Asset Declaration Letter before or after the Clearance Letter upon the first or second Asset Declaration Letter is issued. (9) In the event that Taxpayer submits the second or third Asset Declaration Letter, calculation of Tax Redemption imposition basis in the said Asset Declaration Letter shall take into account the Tax

15 -15- Redemption imposition basis stated in the Clearance Letter upon the previous Asset Declaration Letter. (10) In the event that there is Tax Redemption overpayment due to: a. issuance of correction letter because of miscalculation as referred to in paragraph (6) letter b; or b. submission of the second or third Asset Declaration Letter as referred to in paragraph (8), the said overpayment must be refunded and/or calculated with other tax liabilities within the period of 3 (three) months since the issuance of correction letter or submission of the said second or third Asset Declaration Letter. Article 11 (1) Taxpayer who has submitted Asset Declaration Letter as referred to in Article 8 paragraph (1) and its attachments as referred to in Article 9, shall be given a receipt as a proof of Asset Declaration Letter reception. (2) Taxpayer who has received the receipt as referred to in paragraph (1) shall not be subject to: a. tax audit; b. preliminary evidence tax audit; and/or c. Tax Crime investigation, for fiscal period, part of Fiscal Year, or Fiscal Year up to the end of Last Fiscal Year. (3) In the event that Taxpayer who has received the receipt as referred to in paragraph (1) is under: a. tax audit; b. preliminary evidence tax audit; and/or c. Tax Crime investigation,

16 -16- for fiscal period, part of Fiscal Year, or Fiscal Year up to the end of Last Fiscal Year, the said tax audit, preliminary evidence tax audit, and/or Tax Crime investigation shall be deferred up to the issuance of Clearance Letter. (4) Tax audit, preliminary evidence tax audit, and/or Tax Crime investigation as referred to in paragraph (3) shall be terminated in the event that Minister or the official appointed on behalf of Minister issues Clearance Letter. (5) Taxpayer upon whom the Clearance Letter has been issued shall receive Tax Amnesty facilities in the forms of: a. elimination of tax payable upon which the tax assessment has not been issued, not being subject to tax administration sanctions, and not being subject to tax crime sanctions for tax liabilities in fiscal period, part of Fiscal Year, and Fiscal year, up to the end of Last Fiscal Year; b. elimination of tax administration sanctions in the form of interest, or fine, for tax liabilities in fiscal period, part of Fiscal Year, and Fiscal year, up to the end of Last Fiscal Year; c. not being subject to tax audit, preliminary evidence tax audit, and Tax Crime investigation, upon tax liabilities in fiscal period, part of Fiscal Year, and Fiscal year, up to the end of Last Fiscal Year; and d. termination of tax audit, preliminary evidence tax audit, and Tax Crime investigation in the event that Taxpayer is undergoing tax audit, preliminary evidence tax audit, and Tax Crime investigation upon tax liabilities, up to the end of

17 -17- Last Fiscal Year, which previously have been deferred as referred to in Article 11 paragraph (3), in relation to the tax liabilities as referred to in Article 3 paragraph (5). (6) Termination of investigation as referred to in paragraph (5) letter d shall be conducted by an official in the vicinity of the Directorate General of Taxes performing investigation duties and functions in accordance with the provisions in taxation laws and regulations. CHAPTER VI INVESTMENT OBLIGATIONS UPON DECLARED ASSETS AND REPORTING Article 12 (1) Taxpayer stating to transfer and invest Assets as referred to in Article 8 paragraph (6) must transfer the said Assets through Designated Bank appointed specifically for that purpose by no later than: a. December 31, 2016 for Taxpayer stating to transfer and invest Assets as referred to in Article 8 paragraph (6) letter a; and/or b. March 31, 2017 for Taxpayer stating to transfer and invest Assets as referred to in Article 8 paragraph (6) letter b. (2) The minimum investment period shall be 3 (three) years as referred to in Article 8 paragraph (6) starting from the date of Assets transferred to areas within Republic of Indonesia. (3) Investment as referred to in paragraph (1) shall be made in the following forms: a. commercial paper of the Republic of Indonesia; b. bonds of State-Owned Enterprises;

18 -18- c. bonds of State-Owned Financing Companies; d. financial investment in Designated Bank; e. bonds of private companies whose tradings are supervised by the Financial Services Authority; f. infrastructure investment through Government cooperation with business entities; g. investment in real sectors based on priorities stipulated by Government; and/or h. other forms of legitimate investment in accordance with the laws and regulations. Article 13 (1) Taxpayer or appointed proxy must submit report to Minister or the official appointed on behalf of Minister regarding: a. realization of transfer and investment upon additional Assets declared in Asset Declaration Letter for additional Assets transferred to areas within the Republic of Indonesia, for Taxpayer who is obliged to transfer as referred to in Article 8 paragraph (6); and/or b. placement of additional Assets declared in Asset Declaration Letter for additional Assets located in areas within the Republic of Indonesia, for Taxpayer who is not able to transfer Assets to areas beyond the Republic of Indonesia as referred to in Article 8 paragraph (7). (2) Based on the report as referred to in paragraph (1), Minister or the official appointed on behalf of Minister may issue and deliver warning letter after the end of the delivery period of Asset Declaration Letter in the event of:

19 -19- a. Taxpayer stating to transfer and invest Assets to areas within the Republic of Indonesia does not satisfy the provisions as referred to in Article 8 paragraph (6); and/or b. Taxpayer stating to not transfer Assets to areas beyond the Republic of Indonesia does not satisfy the provisions as referred to in Article 8 paragraph (7). (3) Taxpayer must submit response to the warning letter as referred to in paragraph (2) within a period of 14 (fourteen) working days since the delivery date. (4) In the event that based on Taxpayer s response, it is known that Taxpayer does not satisfy the provisions as referred to in Article 8 paragraph (6) and/or Article 8 paragraph (7), the following provisions shall prevail: a. additional net Assets declared in Clearance Letter shall be treated as income in Fiscal Year 2016 and the said income shall be subject to tax and sanction in accordance with the provisions of taxation laws and regulations; and b. Tax Redemption that has been paid by Taxpayer shall be calculated as tax deduction as referred to in letter a. (5) For Taxpayer as referred to in paragraph (4), provisions regarding special treatment in the event of Tax Amnesty as referred to in Article 11 shall remain in effect. CHAPTER VII TAXATION TREATMENT Article 14 (1) Taxpayer who is obliged to conduct bookkeeping based on the provisions in General Taxation Provisions and

20 -20- Procedures Law, must book the difference between amount of net Assets as referred to in Article 5 paragraph (3) stated in Asset Declaration Letter deducted by amount of net Assets reported by Taxpayer in Last ITR as referred to in Article 6 paragraph (1) letter a, as an additional retained earnings in balance sheet. (2) Additional Assets declared in Asset Declaration Letter as referred to in Article 6 paragraph (1) letter b in the form of intangible assets shall not be amortized for tax purposes. (3) Additional Assets declared in Asset Declaration Letter as referred to in Article 6 paragraph (1) letter b in the form of tangible assets shall not be depreciated for tax purposes. Article 15 (1) Taxpayer who has received Clearance Letter and paid Tax Redemption upon: a. Immovable Assets in the form of land and/or building; and/or b. Assets in the form of shares, the title of which has not been transferred to the Taxpayer, must transfer the title to the Taxpayer. (2) Transfer of title as referred to in paragraph (1) letter a shall be exempted from Income Tax in the event of: a. request for transfer of title; or b. signing of statement letter by both parties in the presence of a notary declaring that Assets as referred to in paragraph (1) letter a is rightfully owned by Taxpayer who submit the Asset Declaration Letter in the event that upon the said

21 -21- Assets, transfer of title has not been able to be requested, is conducted by no later than December 31, (3) Transfer of title as referred to in paragraph (1) letter b shall be exempted from Income Tax in the event that there is an agreement for transfer of title in the period by no later than December 31, (4) If up to December 31, 2017, Taxpayer does not transfer the title as referred to in paragraph (1), the title transferred shall be subject to tax in accordance with the provisions in Income Tax laws and regulations. Article 16 (1) Taxpayer who submits Asset Declaration Letter has no rights to: a. compensate fiscal losses in tax return for part of Fiscal Year or Fiscal Year, up to the end of Last Fiscal Year, to the subsequent part of Fiscal Year or Fiscal Year; b. compensate tax overpayment in tax return upon types of tax as referred to in Article 3 paragraph (5) for fiscal period at the end of Last Fiscal Year to the subsequent fiscal period; c. apply request for tax overpayment refund in tax return upon types of tax as referred to in Article 3 paragraph (5) for fiscal period, part of Fiscal Year, or Fiscal Year, up to the end of Last Fiscal Year; and/or d. revise tax return upon types of tax as referred to in Article 3 paragraph (5) for fiscal period, part of Fiscal Year, or Fiscal Year, up to the end of Last Fiscal Year, after this Law is promulgated.

22 -22- (2) After this Law is promulgated, revision of tax return for fiscal period, part of Fiscal Year, or Fiscal Year, up to the end of Last Fiscal Year, submitted by Taxpayer who submits Asset Declaration Letter shall be deemed not submitted. Article 17 (1) Tax Assessment Letter, Advance Tax Overpayment Refund Decree, Statement of Correction, Reduction of Tax Assessment Decree, Cancellation of Tax Assessment Decree, Objection Decision, Appeal Judgment, Lawsuit Judgment, Judicial Review Judgment, for fiscal period, part of Fiscal Year, and Fiscal Year before the end of Last Fiscal Year, issued before Taxpayer submits Asset Declaration Letter, shall remain as the basis for: a. Directorate General of Taxes to collect tax and/or refund tax overpayment; b. Taxpayer to compensate fiscal losses; and c. Taxpayer to compensate tax overpayment, in accordance with the provisions in taxation laws and regulations. (2) Tax Assessment Letter, Advance Tax Overpayment Refund Decree, Statement of Correction, Reduction of Tax Assessment Decree, Cancellation of Tax Assessment Decree, Objection Decision, Appeal Judgment, Lawsuit Judgment, Judicial Review Judgment, for fiscal period, part of Fiscal Year, and Fiscal Year before the end of Last Fiscal Year, issued after Taxpayer submits Asset Declaration Letter, shall not be used as the basis for: a. Directorate General of Taxes to collect tax and/or refund tax overpayment;

23 -23- b. Taxpayer to compensate fiscal losses; and c. Taxpayer to compensate tax overpayment. (3) In the event that there are Tax Assessment Letter, Advance Tax Overpayment Refund Decree, Statement of Correction, Reduction of Tax Assessment Decree, Cancellation of Tax Assessment Decree, Objection Decision, Appeal Judgment, Lawsuit Judgment, Judicial Review Judgment, for fiscal period, part of Fiscal Year, and Fiscal Year before the end of Last Fiscal Year, issued before Taxpayer submits Asset Declaration Letter, which incurring obligation to pay interest by Directorate General of Taxes, the said obligation shall be eliminated. CHAPTER VIII TREATMENT UPON UNDECLARED OR UNDERDECLARED ASSETS Article 18 (1) In the event that Taxpayer has received Clearance Letter, then there are data and/or information found regarding undeclared or underdeclared Assets in Asset Declaration Letter, the said Assets shall be deemed as additional income received or obtained by Taxpayer during the finding of data and/or information regarding the said Assets. (2) In the event that: a. Taxpayer does not submit Asset Declaration Letter up to the end of Tax Amnesty period; and b. Directorate General of Taxes finds data and/or information regarding Taxpayer s Assets which have been acquired since January 1, 1985 up to

24 -24- December 31, 2015 and have not been reported in ITR, the said Assets shall be deemed as additional income received or obtained by Taxpayer during the finding of data and/or information regarding the said Assets, not later than 3 (three) years starting from the promulgation of this Law. (3) Additional income as referred to in paragraph (1) shall be subject to Income Tax in accordance with the provisions in Income Tax laws and regulations and shall be added with tax administration sanctions in the form of an increase of 200% (two hundred percent) of unpaid or underpaid Income Tax. (4) Additional income as referred to in paragraph (2) shall be subject to tax and sanctions in accordance with the provisions in taxation law and regulations. CHAPTER IX LEGAL ACTION Article 19 (1) Any dispute related to the implementation of this Law can only be settled through lawsuit application. (2) Lawsuit as referred to in paragraph (1) can only be applied to tax court. CHAPTER X MANAGEMENT OF DATA AND INFORMATION Article 20 Data and information deriving from Asset Declaration Letter and its attachments which are administered by Ministry of Finance or other parties related to the

25 -25- implementation of this Law shall not be used as the basis for audit, investigation, and/or criminal prosecution against Taxpayer. Article 21 (1) Minister shall conduct Management of Data and Information in the event of the implementation of this Law. (2) Minister, Vice Minister, staffs of the Ministry of Finance, and other parties related to the implementation of Tax Amnesty are prohibited to divulge, disseminate, and/or inform any data and information known or informed by Taxpayer to other parties. (3) Data and information submitted by Taxpayer in the event of Tax Amnesty cannot be requested by anyone or provided to any other parties based on other laws and regulations, except upon the approval of Taxpayer. (3) Data and information submitted by Taxpayer will be used as taxation data basis of the Directorate General of Taxes. Article 22 Minister, Vice Minister, staffs of the Ministry of Finance, and other parties related to the implementation of Tax Amnesty cannot be reported, sued, under preliminary investigation, under full investigation, or prosecuted, both civil and criminal, if they perform their duties in good faith and in accordance with the laws and regulations.

26 -26- CHAPTER XI CRIMINAL PROVISION Article 23 (1) Any person violating the provisions as referred to in Article 21 paragraph (2) shall be sentenced to imprisonment for a maximum period of 5 (five) years. (2) Any charges against the criminal acts as referred to in paragraph (1) shall only proceed upon a claim of a person whose confidentiality is violated. CHAPTER XII PROVISIONS OF IMPLEMENTATION OF TAX AMNESTY Article 24 Further provisions regarding: a. implementation of Tax Amnesty; b. appointment of Designated Bank receiving transfer of Assets; b. procedures for investment; c. submission of report as referred to in Article 13 paragraph (1); and d. appointment of authorized officials to perform provisions as referred to in Article 10 paragraph (4), Article 10 paragraph (5), Article 10 paragraph (6), Article 11 paragraph (4), Article 13 paragraph (1), and Article 13 paragraph (2), shall be regulated in Ministerial Regulation. CHAPTER XIII CLOSING PROVISION CHAPTER 25 This Law shall come into effect starting from the promulgation date.

27 -27- For public cognizance, the enactment of this Law shall be announced in the State Gazette of the Republic of Indonesia. Enacted in Jakarta on July 1, 2016 THE PRESIDENT OF THE REPUBLIC OF INDONESIA, JOKO WIDODO Promulgated in Jakarta on July 1, 2016 MINISTER OF LAW AND HUMAN RIGHTS OF THE REPUBLIC OF INDONESIA, YASONNA H. LAOLY

28 -28- UNOFFICIAL TRANSLATION ELUCIDATION OF LAW OF THE REPUBLIC OF INDONESIA NUMBER 11 OF 2016 REGARDING TAX AMNESTY I. GENERAL National economic growth in the last several years tends to slow down, which results in the decreasing tax revenue and reduction of domestic liquidity which is highly needed to improve Indonesian economic growth. On the other hand, many Indonesian people s assets are placed beyond the Republic of Indonesia, both in liquid and nonliquid forms, which is supposed to be used to increase domestic liquidity that can support national economic growth. The issue is that part of the Assets existing beyond the Republic of Indonesia have not been reported by the Asset owners in their Annual Income Tax Return, so taxation consequences may arise should it be compared to the Assets reported in the related Annual Income Tax Return. This is one of the factors that causes the owners of Assets hesitate to bring back or transfer their Assets and to invest them in economic activities in Indonesia. Furthermore, the success of national development is greatly supported by public funding which is in the form of tax revenue. In order for the public participation to be evenly distributed without any discrimination, a fairer taxation system with legal certainty is needed to be established. This is based on the fact that many domestic economic activities still have not been reported or are not reported to the tax authorities. These unreported activities disrupt the fairness of

29 -29- Taxpayers who have actively contributed in performing their taxation obligations because the doers do not contribute to national development funding. Therefore, it is necessary to implement certain steps and breakthrough policy to encourage transfer of Assets to areas within the Republic of Indonesia as well as to provide security for Indonesian citizens who intend to transfer and declare their Assets in the form of Tax Amnesty. The breakthrough policy in the form of Tax Amnesty upon transfer of Assets is encouraged by the lower possibility to hide wealth in areas beyond the Republic of Indonesia because of the more transparent global financial sectors and the increasing intensity of exchange of information among countries. Tax Amnesty policy is conducted in the form of relinquishment of the country s rights to collect tax that should have been payable. Therefore, it is fair if Taxpayers are obliged to pay Tax Redemption upon the Tax Amnesty that they receive. In the event of the implementation of this Law, the reception of Tax Redemption is treated as Income Tax revenue in the State Budget. In short term, this policy can increase tax revenue in the year when the Tax Redemption is received which will be useful for the Country to fund a variety of programs that have been planned. In long term, the State will receive tax revenue from the additional economic activities deriving from Assets that have been transferred and invested to areas within the Republic of Indonesia. From juridical aspect, the regulation of Tax Amnesty policy through the Law regarding Tax Amnesty is in accordance with the provision in Article 23A of 1945 Constitution of the Republic of Indonesia because it is related to elimination of tax that should have been payable, tax administrative sanction, and criminal sanctions in taxation area. This Law shall bridge the Assets received from the unreported activities, so that they can be declared voluntarily; thus, the data and information upon the Assets will be in the taxation administrative

30 -30- system and can be used to supervise the compliance in performing taxation obligations in the future. Tax Amnesty policy shall be followed by other policies, such as stricter law enforcement and improvement of General Taxation and Procedures Law, Income Tax Law, Law regarding Value Added Tax on Goods and Service and Sales Tax for Luxury Goods, as well as other strategic policies in taxation and banking areas. By holding firmly to the principles or basis of legal certainty, fairness, benefit, and national interest, the purposes of the enactment of Tax Amnesty Law are as follows: 1. accelerate economic growth and restructuring through transfer of Assets, which among others will impact to the increase in domestic liquidity, improvement of Rupiah exchange rate, decrease in interest rate, and increase in investment; 2. support taxation reformation toward a fairer taxation system and expansion of taxation data basis that is more valid, comprehensive, and integrated; and 3. increase tax revenue, which will be used among others for development funding. In general, the main provisions that are regulated in this Law are as follows: 1. regulation regarding subject of Tax Amnesty; 2. regulation regarding object of Tax Amnesty; 3. regulation regarding Tax Redemption rate and calculation; 4. regulation regarding procedures for submission of Asset Declaration Letter, issuance of Clearance Letter, and amnesty upon taxation obligations; 5. regulation regarding investment obligations upon declared Assets and the reporting; 6. regulation regarding taxation treatment; 7. regulation regarding treatment upon undeclared or underdeclared Assets; 8. regulation regarding legal action;

31 regulation regarding management of data and information; and 10. regulation regarding criminal provisions. II. ARTICLE BY ARTICLE Article 1 Article 2 Paragraph (1) Letter a Legal certainty shall be that the implementation of Tax Amnesty should actualize public order through security of legal certainty. Letter b Fairness shall be that the implementation of Tax Amnesty must uphold the balance between rights and obligations of every party involved. Letter c Benefit shall be that all regulations of Tax Amnesty policy are beneficial for the interest of state, nation, and public, especially in increasing public welfare. Letter d National interest shall be that the implementation of Tax Amnesty prioritizes the interest of nation, state, and public above any other interests. Paragraph (2) Article 3 Paragraph (1) Taxpayer who has the right to obtain Tax Amnesty is a Taxpayer who has the obligation to submit ITR. In the event that Taxpayer has not had Tax Identification Number, Taxpayer must register himself/herself first to obtain

32 -32- Tax Identification Number in the Directorate General of Taxes office where Taxpayer resides or domiciles. Paragraph (2) Paragraph (3) Paragraph (4) Paragraph (5) Article 4 Article 5 Paragraph (1) In the event that Taxpayer has just obtained Tax Identification Number in 2016 and has not submitted the Last ITR, all additional net Assets declared in Asset Declaration Letter shall be calculated as the imposition basis of Tax Redemption. Paragraph (2) In principle, Tax Amnesty shall be given upon taxation obligations that have not been or have not been entirely settled by Taxpayer, which are represented in Assets that have not been reported in the Last ITR. The amount of Tax Redemption is additional Assets that have not been reported in the Last ITR deducted by the amount of Debt related to the acquisition of the additional Assets. This provision regulates the calculation of Tax Redemption that must be paid by Taxpayer who submits the Asset Declaration Letter.

33 -33- Example 1: Taxpayer A only owns Assets located in the areas within the Republic of Indonesia. In the ITR of Fiscal Year 2015 (Last ITR), Taxpayer reports: a. Value of Assets IDR15,000,000,000 b. Amount of Debt IDR5,000,000,000 _ c. Amount of net Assets IDR10,000,000,000 In the Asset Declaration Letter submitted in the first month up to the end of the third month starting from the promulgation of this Law, it is known that: a. Value of Assets IDR20,000,000,000 b. Amount of Debt IDR6,000,000,000 _ c. Amount of net Assets IDR14,000,000,000 Therefore, the Tax Redemption imposition basis shall be: IDR14,000,000,000 - IDR10,000,000,000 = IDR4,000,000,000. The Tax Redemption Calculation: The rate for the first month up to the end of the third month starting from the promulgation of this Law shall be 2% (two percent); The Tax Redemption imposition basis shall be IDR4,000,000,000; the Tax Redemption that must be paid: 2% x IDR4,000,000,000 = IDR80,000,000. Example 2: Taxpayer B participates in Tax Amnesty program and has the intention to transfer half of the Assets from areas beyond the Republic of Indonesia to areas within the Republic of Indonesia; however, in the ITR of Fiscal Year 2015 (Last ITR), Taxpayer B

34 -34- only reports Assets located in areas within the Republic of Indonesia with the following details: a. Value of Assets IDR15,000,000,000 b. Amount of Debt IDR 5,000,000,000 _ c. Amount of net Assets IDR10,000,000,000 In the Asset Declaration Letter submitted in the first month up to the end of the third month starting from the promulgation of the Law, it is declared that: a. Taxpayer s total of Assets as of December 31, 2015 is IDR50,000,000,000, which consists of: 1. Value of Assets in the Last ITR is IDR15,000,000,000; 2. Value of Assets that has not been reported in the Last ITR is IDR35,000,000,000, which consists of: a) Value of Assets located in areas beyond the Republic of Indonesia which will be transferred to areas within the Republic of Indonesia amounting to IDR12,000,000,000; b) Value of Assets located in areas beyond the Republic of Indonesia which will not be transferred to areas within the Republic of Indonesia amounting to IDR23,000,000,000; b. Taxpayer s total of Debt as of December 31, 2015 is IDR14,000,000,000, which consists of: 1. Amount of Debt in the Last ITR is IDR5,000,000,000; 2. Amount of Debt which has not been reported in the Last ITR is IDR9,000,000,000, which consists of: a) Amount of Debt related to Assets located in areas beyond the Republic of Indonesia which will be transferred to areas within the Republic of Indonesia amounting to IDR3,000,000,000; b) Amount of Debt related to Assets located in areas beyond the Republic of Indonesia which will not be

35 -35- transferred to areas within the Republic of Indonesia amounting to IDR6,000,000,000; c. Amount of net Assets during the submission of Asset Declaration Letter: 1. Amount of net Assets related to the Assets that will be transferred to areas within the Republic of Indonesia shall be: IDR12,000,000,000 - IDR3,000,000,000 = IDR9,000,000,000; 2. Amount of net Assets related to the Assets located in areas beyond the Republic of Indonesia which will not be transferred to areas within the Republic of Indonesia shall be: IDR23,000,000,000 - IDR6,000,000,000 = IDR17,000,000,000. Therefore, the Tax Redemption imposition basis for: 1. Assets which will be transferred to areas within the Republic of Indonesia shall be: IDR9,000,000,000 0 = IDR9,000,000, Assets which will not be transferred to areas within the Republic of Indonesia shall be: IDR17,000,000,000 0 = IDR17,000,000,000 The Tax Redemption Calculation: The applicable rates during the first month of Asset Declaration Letter submission up to the end of the third month starting from the promulgation of this Law shall be: a. 2% (two percent) for Assets which will be transferred to areas within the Republic of Indonesia; and b. 4% (four percent) for Assets which will not be transferred to areas within the Republic of Indonesia, thus, the Tax Redemption calculations are as follows:

36 for Assets which will be transferred to areas within the Republic of Indonesia: 2% x IDR9,000,000,000= IDR180,000, for Assets which will not be transferred to areas within the Republic of Indonesia: 4% x IDR17,000,000,000= IDR680,000,000. Therefore, the total Tax Redemption paid by Taxpayer shall be: IDR180,000,000 + IDR680,000,000 = IDR860,000,000 Paragraph (3) In the event that the Debt related to the acquisition of additional Assets have been reported in the Last ITR, the Debt should not be calculated as deduction of value of Assets in Asset Declaration Letter. Article 6 Paragraph (1) Paragraph (2) Paragraph (3) Paragraph (4) This provision regulates the determination basis for amount of additional Assets at the end of book year which is declared in Asset Declaration Letter. Fair value shall be the value describing the condition and circumstances of similar or equivalent assets based on Taxpayer s assessment. The said Fair Value shall be recorded as acquisition value of Assets which is reported by no later than the ITR of Fiscal Year 2017.

37 -37- Example 1: For Taxpayer whose book year is the same as calendar year: Amount of additional Assets declared in Asset Declaration Letter shall be the value of Assets as of December 31, 2015 in accordance with fair value of Assets other than cash or in accordance with nominal value of Assets in the form of cash on the date. Example 2: For corporate Taxpayer whose book year is not the same as calendar year, as an example, Taxpayer C uses book year which is started in August 2014 and ended in July 2015: The amount of additional Assets declared in Asset Declaration Letter shall be the value of Assets other than cash as of July 31, 2015 in accordance with fair value of Assets other than cash or in accordance with nominal value in the form of cash on the date. Paragraph (5) Article 7 Paragraph (1) Debt related to the additional Assets shall be the Debt that can be legally accounted in terms of their validity and existence that the debt is directly used to acquire the additional Assets, such as the Debt is acknowledged as account receivable by lender. Paragraph (2) The provision in this paragraph shall only prevail for the interest of the implementation of this Law. Paragraph (3) Paragraph (4) Paragraph (5)

38 -38- Paragraph (6) Article 8 Paragraph (1) Paragraph (2) The highest corporate position : a. in a Limited Liability Company shall be chairman of the Board, president director, or those with equivalent positions by taking into account the organizational structure in the deed of establishment or other equivalent documents; b. in a foundation, shall be the head of foundation; c. in a cooperative, shall be the head of cooperative. Absent shall be not able to perform obligations during term of office. Paragraph (3) Letter a Letter b Letter c Letter d Letter e This provision regulates that: a. for Taxpayer who has already had Tax Identification Number before 2016 that: 1. has submitted Last ITR, Taxpayer must attach a copy of the Last ITR; or

39 has not submitted the Last ITR, Taxpayer must first submit the Last ITR and attach it with the Asset Declaration Letter; or b. for Taxpayer who has just obtained Tax Identification Number in 2016 and 2017, Taxpayer is not obliged to attach a copy of the Last ITR. Letter f Paragraph (4) Paragraph (5) Tax payment slip that functions as proof of payment of Tax Redemption is deemed legal after being validated by State Revenue Transaction Number issued through state revenue module. Paragraph (6) In the event that Taxpayer transfers his/her Assets from areas beyond the Republic of Indonesia to areas within the Republic of Indonesia through a branch of Designated Bank located overseas, the period of 3 (three) months is counted since Taxpayer placed his/her Assets in the said branch of Designated Bank located overseas. The said branch of Designated Bank is obliged to transfer the said Assets to domestic Designated Bank. Paragraph (7) Article 9 Paragraph (1) Information regarding Taxpayer s identity shall be information consisting of name, address, Tax Identification Number, passport number, Single Identity Number, and business license.