Indonesia's Ministry of Education and Culture to Start Partnership with Netflix Despite Blocking and Tax Problem

Indonesia's Ministry of Education and Culture is officially partnered with Netflix despite problems with taxation and blocking.
Indonesia's Ministry of Education and Culture is officially partnered with Netflix. The collaboration was announced directly through Netflix Indonesia's official Twitter account this afternoon, January 9, 2020.

Netflix Indonesia will start the partnership with two organizations under Ministry of Education and Culture, The Film Development Center of the Republic of Indonesia and Indonesia's Directorate General of Culture.

Minister of Education and Culture Nadiem Makarim revealed that the collaboration with Netflix is a start in order to realize a more innovative Indonesian culture. He stated, from his office in Jakarta on Thurday (9/1/2020), that the steps that began today are the first steps to focus on showing the spread of Indonesian cinema on the world.

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Indonesia's Minister of Education and Culture, Nadiem Makarim. Source: Netflix Indonesia Twitter

This step is not only used to market Indonesia's achievements in cinematography, but it can also be used to showcase Indonesian culture. One of Nadiem's goals from this collaboration is to make Indonesia to become the best-selling filming place in the world.

"Through this initiative, we want to be able to contribute to the growth of the creative community in Indonesia. Netflix hopes that these stories can bring unique themes about Indonesia and can be enjoyed by the world community," stated by Netflix Asia Pacific Managing Director, Kuek Yu-Chuang through Netflix Indonesia's twitter account.

Netflix will hold training for 15 selected scriptwriters who will be sent directly to Hollywood which planned to be carried out in March 2020. This method is done to produce a reliable script writer from Indonesia. After these steps are taken, the Ministry of Education and Culture will also make script writing training for television and film in Indonesia.

Not only that, Netflix will also provide training workshops for 100 scriptwriters in Indonesia. Then provide funds of USD 1 million in order to kick-start these trainings.

In addition, Netflix and the Ministry of Education and Culture (Kemendikbud) will also hold a short film competition with the prize of 600 thousand US dollars. The competition theme is the Pancasila, the foundational philosophical theory of Indonesia. As of today, the date and the details regarding the competition has not been announced.

As of today, there are already a number of original Indonesian films that can be accessed through the Netflix website and application, namely 'The Night Comes For Us', 'Filosofi Kopi', 'Kuntilanak', and several others.

Netflix in Indonesia

Despite this partnership, Netflix is still blocked by Telkom and its subsidiaries, Indonesia's owned telecommunication provider. Telkom has blocked Netflix since January 2016 due to business problems. Netflix cannot be accessed throughTelkom and subsidiaries such as Telkomsel, Indihome, and

Reported in Kompas on Teusday, January 7 2020, Indonesia's Minister of Communication and Information, Johnny G Plate asked Telkom and its subsidiary Telkomsel to sit together with Netflix to resolve the dispute.

Meanwhile, reported by CNBC Indonesia in 14 November 2019, it turns out that Netflix has never paid taxes in Indonesia. Finance Minister Sri Mulyani Indrawati confirmed that the government is pursuing digital corporate taxes including Netflix.

Sri Mulyani said that the Netflix tax and other digital companies are Indonesia's homework because there are companies that do not yet have a permanent establishment or permanent business entity in Indonesia.

The absence of this permanent establishment made tax collection from Netflix becomes impossible since the current law does not define Netflix as Indonesia's taxpayer.

Explained by Sri Mulyani on Tuesday (10/29/2019,) a new law is being proposed to address this issue. The law will allow tax collection from digital companies which does not have permanent establishment in Indonesia but has significant economic present.

Sri Mulyani added Australia to Singapore had already implement and collect taxes from Netflix. There is even a law called Netflix Tax.

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