On June 19, 2024, the Ministry of Economy and Finance released Prakas on Guidelines for the Implementation of the Sub-Decree on Tax Incentives for the Development of the Informal Economy in response to the issuance of Instruction No. 18412 on the Implementation of Tax Incentives for Micro, Small, and Medium Enterprises for the Development of the Informal Economy.

The definitions of Micro, Small, and Medium-Sized Enterprises (or "MSMEs") given in this Prakas are mostly in line with Prakas No. 009 on the Taxpayer Classification Under the Self-Assessment Regime, which was published on January 12, 2021. Therefore, if they voluntarily register with the tax administration, MSMEs working in four key sectors—(1) wholesale, retail, and repair services; (2) lodging and food services; (3) handicrafts; and (4) agricultural cooperatives—may be eligible for a number of tax benefits.

Definition of Micro, Small, and Medium Enterprises:

Micro, Small, and Medium Enterprises shall receive following tax incentives:

1. For voluntary tax registration in the years 2023-2028, the tax registration fees, information update service fees, and tax registration certificate printing prices are waived for microenterprises.
2. For voluntary tax registration in the year 2023-2028, small enterprises are entitled to exemptions as follows:
   • Tax debts and penalties directly related to business operations, such as unpaid taxes, additional taxes, interest, and fines for noncompliance during the time leading up to the voluntary tax registration.
   • Tax registration fees, information update service fees, and fees for printing tax registration certificates.
   • Patent tax at the time of registration
   • Patent tax for 2 years following successful tax registration in 2024 or 2025.
   • Prepayment of income taxes, income taxes, and minimum taxes for a two-year period after tax registration, starting from the year the tax was registered and ending with the following tax year.

3. For voluntary tax registration in the year 2023-2028, medium enterprises are entitled to exemptions as follows:

• Tax debts and penalties directly related to business operations, such as unpaid taxes, additional taxes, interest, and fines for noncompliance during the time leading up to the voluntary tax registration.
• Patent tax at the time of registration
• Patent tax for 2 years following successful tax registration in 2024 or 2025.
• Prepayment of income taxes, income taxes, and minimum taxes for a two-year period after tax registration, starting from the year the tax was registered and ending with the following tax year.

It is crucial to remember that tax administration unilateral registrations and non-registration within 15 days of receiving a second request to register are not regarded as voluntary tax registration.

Enterprises shall comply with below obligations: