Indonesia's import shyness Malaysia's gain in SE Asia's e-commerce race

Indonesia is an outlier in Southeast Asia with its protectionism when it comes to international e-commerce transactions. Neighbour Malaysia, armed with an Alibaba partnership, is starting to step up as a regional hub

In response to growing cross-border shipments, Indonesia has lowered its de minimis fee twice in under two years

It used to be US$100. Now, only goods worth less than US$3 can be shipped into Indonesia tax-free

Malaysia, meanwhile, welcomes international shipments. It allows merchants to store inventory at low cost before shipping it across the region

In Malaysia, cross-border is as much about letting goods in as it is about enabling SMEs to access international markets

In January 2020, Indonesia lowered its threshold for goods that can be imported duty- and tax-free: from US$75 to a strikingly low US$3. It was the second adjustment of the so-called de minimis rate in short succession. The government had brought it down from US$100 to US$75 in 2018.

It was a reaction to a growing trend made possible by e-commerce, which has made the flow of goods across borders increasingly complex and difficult to control.

Overseas shipments into Indonesia from e-commerce purchases jumped jumped The Jakarta Post Indonesia to lower threshold for import taxes on e-commerce goods Read more to nearly 50 million packages in 2019, compared with 19.6 million in 2018 and 6.1 million the year before.

AUTHOR

Nadine Freischlad

Nadine is based in Indonesia. She covers Southeast Asia's super apps, the changing nature of work and employment, and other structural shifts happening as a result of digital disruption.

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