The Ministry of Economy and Finance ("MEF") issued Prakas No. 525 ("Prakas") on 22 August 2024. The Prakas intends to revoke Prakas No. 360, which previously outlined the framework for implementing Sub-Decree No. 113 concerning Tax Incentives for the Informal Economy, issued on 19 June 2024. Therefore, despite the repeal of Prakas No. 360, tax benefits for Micro, Small, and Medium Enterprises (“MSMEs”) should still be in effect, as their foundation is established in the National Strategy for Informal Economic Development 2023-2028 and the previously mentioned Sub-Decree No. 113. To the best of our understanding, any existing tax incentives continue to be available, given that Prakas No. 360 mainly functioned to define MSMEs.

To provide some context, Prakas No. 360 created the regulatory structure for offering tax benefits to MSMEs with the goal of formalizing the informal economy. It specified the regulations, processes, and classification standards for MSME taxpayers under the self-assessment system across four key sectors: (1) wholesale, retail, and repair services, (2) accommodation and food services, (3) handicrafts, and (4) agricultural cooperatives.