In order to protect the local market, Indonesian law does not allow anyone (with the possible exception of embassy personnel) to import a USED car here.

Only new cars are allowed for import, and importing a car from abroad is rarely done by your average expatriate in Indonesia because the Indonesian customs offices charge up to 300% duty on the car's value.

Buying an Automobile

A wide range of cars brands are available on the Indonesian market. However, the models of these brands are generally limited to 4-door sedans or van-type vehicles. Because most car owners use drivers, 2-door sport cars are uncommon and are not in high demand.

In Indonesia, according to the regulations, the engine size of a car may not exceed 3,000 CCs. Cars exceeding this engine size are occasionally imported under special conditions (i.e., on request of a diplomat or for special government functions), however the legal documents of these cars are not necessarily complete after they have been released from the original importers possession. Smuggling of luxury cars also occurs. Needless to say, the documents for these smuggled vehicles are not complete. Therefore, be aware that if you purchase a 3,000 CC car, it may be difficult to resell and may in fact be confiscated by the authorities.

Ranking diplomats are eligible to import luxury cars through their embassy offices. Some diplomats use this facility to import a luxury car, sell it to an Indonesian and then they drive a local car. All for a nice profit! Be cautious about buying one of these cars as all kinds of paperwork hassles could ensue.

Because cars are considered a luxury item, there is a substantial tax added onto the manufacturer’s price. This greatly inflates the price of cars in Indonesia.

Procedure

When buying a new car the customer is required to have:

1. Valid Passportand KITAS (for foreigner), or KTP (Kartu Tanda Penduduk/Identity Card) for an Indonesian.

Indonesians register their cars using their KTP identity card, foreigners must use their passports & KITAS. In many cases, the car is purchased under the name of the employing company and the individual then buys or leases the vehicle, while the paperwork stays in the company. s name.

If a company wants to assist a foreign employee in purchasing a vehicle, they must present the following documents:

a. Photocopy SIUP (Surat Ijin Usaha Pedagang/Permission to do Business)
b. Photocopy of NPWP (Nomor Pokok Wajib Pajak/Tax Number)
c. Photocopy Surat Keterangan Dominici (address of the company)
d. Photocopy Akte Perusahaan (Company Certificate)

2. Cash or means of financing the vehicle.

IMPORTANT NOTE: Foreigners should be aware that while most Indonesian banks will not give loans to foreigners to purchase a car, you may be able to get a car financed through an automotive finance company through the car dealership. A few joint venture finance companies will arrange leasing contracts for foreigners, if it is for the purchase of their affiliate company's vehicles. These companies require:

a. A photocopy of your passport
b. A photocopy of your KITAS (Limited Stay Permit Card)
c. A Letter of Guarantee from your employer, stating that they will make your payments if you default.