a. Circular Letter Number SE-27 / PJ.

22 / 1986 About "Entertainment" Fees And The Like

(General Pph Series 18)
With regard to the many questions regarding the costs of "entertainment", representation,
guest meals and the like which can be deducted from income, hereby an explanation is given
as follows:

1. The costs of "entertainment", representation, entertainment and the like to obtain,

collect and maintain income can basically be deducted from gross income as referred
to in Article 6 paragraph (1) letter a of the 1984 Income Tax Law.
2. Taxpayers must be able to prove, that these costs have actually been issued (formal)
and have something to do with the company's activities to get, collect and maintain
corporate income (material).
3. Therefore, taxpayers who deduct these costs from their gross income, since the 1986
tax year to attach to the Annual Notification Letter nominative list as attached which
contains:
a) Serial number.
b) Date "entertainment" and the like have been given.
c) The name of the place "entertainment" and the like that have been given.
 Address "entertainment" and the like that have been given.
 Types of "entertainment" and the like that have been given.
 Amount (Rp) "entertainment" and the like have been provided.
d) Business relations provided "entertainment" and the like in accordance with the
sequence number above contain:
 Name
 Position
 Company name
 Type of business.
4. If tax officials who conduct research or examination of 1984 and 1985 Annual
Notification Letter find "entertainment" expense items and the like, taxpayers should
be asked for the nominative list as mentioned above to prove that these costs have
actually been incurred. and it has something to do with the company's activities to
obtain, collect and maintain company income.

b. Regulation Of The Minister Of Finance Of The Republic Of Indonesia No. 81 /PMK.03/2009

About Forming Or Fertilizing Backup Funds Shall Be Reduce As Cost
Consists of 20 articles that discuss the formation or fertilization of reserve funds that may be
deducted as costs, the rules determining the percentage of reserves provided.

c. Minister of Finance Regulation No. 02 / PMK03 / 2010 Regarding Promotional Costs

d. Regulation of the Minister of Finance of the Republic of Indonesia No. 207 / PMK. 010/2015
Regarding the Second Amendment to the Minister of Finance Regulation No. 105 / PMK.
 03/2009 About Obviously Non-Collectible Receivables that can be deducted from gross
income.

e. Decree of the Director General of Taxes No. KEP-220 / PJ / 1986 Regarding the Treatment
of Income Taxes on the Cost of Using Cellular Phones and Corporate Vehicles.

f. Director General of Tax Circular No. SE-09 / PJ.42 / 2002 Regarding the Income Tax
Treatment of Cellular Phone Usage Charges.