Apple & Microsoft agree to 'rubbery' new content law in Indonesia

Posted:
in General Discussion edited July 2022
Big Tech companies, including Apple, have registered for licences in Indonesia, which gives local authorities "flexible" and "rubbery" powers to censor platforms.




Ahead of Indonesia's July 20, 2022 deadline, major Big Tech companies appear to have all agreed to the country's new content laws. A total of 207 non-Indonesia companies signed up, reportedly some just hours before the deadline.

According to the Financial Times, signing up to the new regulation means that local authorities can demand content be removed if they disturb "society" or "public order." They can also demand access to the companies' data.

The detail of what data can be demanded, and the definitions of what constitutes public order or societal disturbance, are intentionally vague. The country's Alliance of Independent Journalists described the criteria as "flexible" and "rubbery."

It's not clear when Apple signed up its iCloud platform to the law, and the company has yet to comment publicly. Twitter appears to have signed on the deadline day, where Meta's Facebook, WhatsApp, and Instagram joined a day before.

Microsoft's cloud service is among the platforms now bound by the laws.

A spokesperson for TikTok told the Financial Times that it had signed up because it "will always comply with the prevailing regulations in any market where we operate." The spokesperson added that that the company believes, "the Indonesian government will honor freedom of expression."

Twitter told the publication only that it remained committed to encouraging an "open internet," and looked forward to working with the Indonesian government.

If firms did not sign up to the new regulations, they would reportedly have first faced warnings, then fines. Ultimately they could banned in the country entirely.

It's far from the first time that Apple has bowed to censorship or potential censorship overseas. Ahead of Russian elections in 2021, Apple and Google both dropped the official opposition app from their app stores.

Both companies later restored the app, but pointlessly as they only did so after the election.

Read on AppleInsider

Comments

  • Reply 1 of 11
    gatorguygatorguy Posts: 24,176member
    The companies, including Apple, have also agreed to a value-added tax on digital goods, virtual or content connected.  How the VAT is computed should be interesting. 
    edited July 2022 Mac4macmuthuk_vanalingam
  • Reply 2 of 11
    22july201322july2013 Posts: 3,564member
    gatorguy said:
    The companies, including Apple, have also agreed to a value-added tax on digital goods, virtual or content connected.  How the VAT is computed should be interesting. 
    I'm already paying that type of tax in Canada on my Apple One service package. Why is it interesting?
    sphericwatto_cobra
  • Reply 3 of 11
    gatorguy said:
    The companies, including Apple, have also agreed to a value-added tax on digital goods, virtual or content connected.  How the VAT is computed should be interesting. 
    Ruh-roh… VAT’s not very good for consumers… they’ll be simmering in a vat of taxes that will slowly go higher and higher. Vat’s not a good idea, but ve haf vays of taxing you!

    Try the overly taxed salmon, I’d be here all week but the rent is too damned high 🤣😂
    watto_cobra
  • Reply 4 of 11

    VAT and sales tax are much the same as the end-user pays the tax. One negative is that VAT requires extra accounting by those in the middle of the supply chain, however, this is countered by not requiring to determine who is, and is not, an end user.

    Import/exports can have problems between VAT and sales tax countries in the form of double taxation, which usually require special measures.

    sphericwatto_cobra
  • Reply 5 of 11
    gatorguygatorguy Posts: 24,176member
    gatorguy said:
    The companies, including Apple, have also agreed to a value-added tax on digital goods, virtual or content connected.  How the VAT is computed should be interesting. 
    I'm already paying that type of tax in Canada on my Apple One service package. Why is it interesting?
    How is it determined? Are the vendors, ie Apple, supplying transaction cost specifics to the country so that taxing authorities can compute the value added? That's why it's interesting to me.
    muthuk_vanalingam
  • Reply 6 of 11
    danoxdanox Posts: 2,799member
    Regionalize iPhones are coming various governments around the world are going to make it so.
  • Reply 7 of 11
    22july201322july2013 Posts: 3,564member
    gatorguy said:
    gatorguy said:
    The companies, including Apple, have also agreed to a value-added tax on digital goods, virtual or content connected.  How the VAT is computed should be interesting. 
    I'm already paying that type of tax in Canada on my Apple One service package. Why is it interesting?
    How is it determined? Are the vendors, ie Apple, supplying transaction cost specifics to the country so that taxing authorities can compute the value added? That's why it's interesting to me.
    You said "so that the taxing authorities can compute the [tax]". But that's not how it works. Apple itself computes the tax for my monthly bill and when I pay the bill at the end of the month, Apple (probably) writes a cheque to the government after I've paid up. Basically, the government trusts Apple to compute the correct amount. The government isn't involved in "computing the tax." 

    It's the same thing if I buy dinner at my local restaurant: the local restaurant computes the tax, makes me pay it, and then sends the taxes to the government (probably monthly). At no point does the government get involved in "computing" as your question suggests. I suppose the government can audit any business, including Apple, to validate that the correct amount of taxes were paid.

    I would expect that's exactly how it works in each US state that has a sales tax. Over half of the states in the US have sales taxes on digital goods. Are you not in one of those states?
    watto_cobra
  • Reply 8 of 11
    davidwdavidw Posts: 2,036member
    gatorguy said:
    The companies, including Apple, have also agreed to a value-added tax on digital goods, virtual or content connected.  How the VAT is computed should be interesting. 
    I would think the only VAT India is concern about with digital goods sale, is the final one charged to the consumers (like the sales tax here.). Apple and other companies selling "digital goods" have agree to is to charge and  "collect" a VAT on the digital goods they sell, not calculate and "pay" a VAT on the digital goods they eventually sell. I believe nearly all EU countries been charging consumers a VAT on most digital goods for quite a while now. In the EU, it's not uncommon for consumers to pay a VAT on streaming service subscriptions like Apple Music, Netflix, Spotify, Disney, Hulu, YouTube Prime, etc. And maybe even a VAT on their home internet service, cable and satellite TV service. 

    Here in the US, we do not have a National tax on sales (like a VAT), all sales tax on goods is determined by each of the States and paid at the final purchase. CA do not yet have a tax on digital goods. But some States do and other States call it a "streaming tax" (also known as a "Netflix tax") or "Amusement tax", rather than a sales tax, as most States "sales tax" laws do not apply to intangible goods. Some States apply a tax to digital streaming services to make up for the loss sales tax revenue from renting movies on a physical media, from a physical store.  Here Apple and others, have to figure that out as they would be liable for the tax to each State, even if they didn't know they were suppose to collect it from the customer. 


    https://www.taxjar.com/blog/sales-tax-digital-products

    California – Digital products are tax exempt in California. The “sale of electronic data products such as software, data, digital books (eBooks), mobile applications and digital images is generally not taxable” (though if you provide some sort of physical copy or physical storage medium then the sale is taxable.) (Source: California BOE Publication 109 – “Non Taxable Sales”).   

    CA do not have a sales tax on goods determined to be intangible and CA do not have an amusement tax. But that doesn't mean that CA can not eventually tax digital streaming service subscriptions. They just can't refer to it as a "sales tax", unless they make an exception to current sales tax laws.

    This is another added feature for developers choosing to have Apple or Google process the payments in their app stores. Apple and Google will automatically figure out what taxes to charge for each State (or VAT for the countries they collect the VAT for), keep track of it and will remit the taxes collected to each State (or country), for the developers. If a developer chooses their own payment system, they are the ones responsible for collecting, keeping track and remitting the taxes to each State and country, from which they made a sale.   


    watto_cobra
  • Reply 9 of 11
    gatorguygatorguy Posts: 24,176member
    gatorguy said:
    gatorguy said:
    The companies, including Apple, have also agreed to a value-added tax on digital goods, virtual or content connected.  How the VAT is computed should be interesting. 
    I'm already paying that type of tax in Canada on my Apple One service package. Why is it interesting?
    How is it determined? Are the vendors, ie Apple, supplying transaction cost specifics to the country so that taxing authorities can compute the value added? That's why it's interesting to me.
    You said "so that the taxing authorities can compute the [tax]". But that's not how it works. Apple itself computes the tax for my monthly bill and when I pay the bill at the end of the month, Apple (probably) writes a cheque to the government after I've paid up. Basically, the government trusts Apple to compute the correct amount. The government isn't involved in "computing the tax." 

    It's the same thing if I buy dinner at my local restaurant: the local restaurant computes the tax, makes me pay it, and then sends the taxes to the government (probably monthly). At no point does the government get involved in "computing" as your question suggests. I suppose the government can audit any business, including Apple, to validate that the correct amount of taxes were paid.

    I would expect that's exactly how it works in each US state that has a sales tax. Over half of the states in the US have sales taxes on digital goods. Are you not in one of those states?
    AFAIK VAT is not exactly the same as a sales tax, computation and liability both different. Am I incorrect?

    EDIT: Found this explanation which indicates the terms are not interchangeable, nor is the methodology the same.
    https://tax.thomsonreuters.com/blog/what-is-the-difference-between-sales-tax-and-vat/#:~:text=Sales tax: Tax authorities do,chain as value is added.
    edited July 2022
  • Reply 10 of 11
    crowleycrowley Posts: 10,453member
    gatorguy said:
    gatorguy said:
    gatorguy said:
    The companies, including Apple, have also agreed to a value-added tax on digital goods, virtual or content connected.  How the VAT is computed should be interesting. 
    I'm already paying that type of tax in Canada on my Apple One service package. Why is it interesting?
    How is it determined? Are the vendors, ie Apple, supplying transaction cost specifics to the country so that taxing authorities can compute the value added? That's why it's interesting to me.
    You said "so that the taxing authorities can compute the [tax]". But that's not how it works. Apple itself computes the tax for my monthly bill and when I pay the bill at the end of the month, Apple (probably) writes a cheque to the government after I've paid up. Basically, the government trusts Apple to compute the correct amount. The government isn't involved in "computing the tax." 

    It's the same thing if I buy dinner at my local restaurant: the local restaurant computes the tax, makes me pay it, and then sends the taxes to the government (probably monthly). At no point does the government get involved in "computing" as your question suggests. I suppose the government can audit any business, including Apple, to validate that the correct amount of taxes were paid.

    I would expect that's exactly how it works in each US state that has a sales tax. Over half of the states in the US have sales taxes on digital goods. Are you not in one of those states?
    AFAIK VAT is not exactly the same as a sales tax, computation and liability both different. Am I incorrect?

    EDIT: Found this explanation which indicates the terms are not interchangeable, nor is the methodology the same.
    https://tax.thomsonreuters.com/blog/what-is-the-difference-between-sales-tax-and-vat/#:~:text=Sales tax: Tax authorities do,chain as value is added.
    As an end customer it appears the same, a flat rate on the purchase price, but there will a system of VAT deductions within the business accounting. I.e. Apple will get to claim a VAT refund on the wholesale price of the content that they are reselling.

    Or something to that effect anyway, I have no idea of the specifics of how things work in Indonesia.
  • Reply 11 of 11
    mcdavemcdave Posts: 1,927member
    "will always comply with the prevailing regulations in any market where we operate." it’s stunning that some companies are so arrogant they think they’re impervious to local doctrine.
    Last year I worked for an online secondary education company expanding its international market. The local ‘LGBT-friendly’ content for kids didn’t go down well in the Middle East (or Catholic schools) but when forced to change the lesson content, the militants in the content team were up in arms. Almost as if they felt political infiltration was their right & duty.
    watto_cobra
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