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Buying a Car in Indonesia

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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.

Importing a car from abroad is rarely done by your average expatriate in Indonesia because the Indonesian customs offices charges up to 300% duty on the car's value - which they assess.

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.

Note - Effective June 2012 - consumers who want to take out a loans to buy a motorcycle or car will have to pay at least 25 percent of the total cost as a downpayment, as opposed to as low as 5 percent to 10 percent in the past. This new regulation was passed by the government financial regulators to attempt to curb excessive lending practices by multifinance lenders and banks.

Buying a New Car

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

1. Valid Passport and ITAS or ITAP (for foreigner), or KTP (Kartu Tanda Penduduk/Identity Card) for an Indonesian. As a foreigner, if you do not have an ITAS /ITAP, you cannot legally own a car in Indonesia. As long as the person has a valid ITAS and a letter from the sponsoring company - they are allowed to purchase a vehicle in their name.

Indonesians register their cars using their KTP identity card, foreigners must use their passports and ITAS /ITAP. 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.

Some reports say that a foreign passport/ITAS/ITAP may not be accepted by the seller. In this case the buyer may have to purchase the car through someone with a KTP.

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 Domicili (stating 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 ITAS (Limited Stay Permit Card)
c. A Letter of Guarantee from your employer, stating that they will make your payments if you default.
Upon the completion of the transaction the purchaser should receive:
a. STNK (Surat Tanda Nomor Kendaraan/Vehicle Registration Number). This document should be carried in the vehicle at all times as a police officer will ask for it if you are stopped.
b. Plat Nomor (license plates)
c. BPKB (Buku Pemilik Kendaraan Bermotor/Proof of Ownership book). This is normally a blue or red book. Never carry this book in the car as if it is stolen with your car, the car can be easily resold.
d. Faktor (original invoice for the car)
e. Kwitansi Pembayaran (receipt for the actual cash transaction)
After the purchase of a new car it will normally take approximately one week to process the STNK and the license plates. The customer can take immediate possession of the car upon the completion of the transaction and drive it home, however it cannot be driven on the streets without the STNK and the license plates.

Buying a Used Car

By Indonesian Law, it is illegal to import used cars, however some unscrupulous importers do import what they say are new cars but are actually 1 or even 2 year old cars with the odometer reset close to zero. Be cautious when buying imported cars.

It is a common practice in Indonesia that when a car is sold, the car registration is left under the name of the original owner. This is done to avoid paying ongkos balik nama or change of ownership fee, which is quite costly (the costs are listed in a table at the department that is based on the year and model of the car). By explaining these procedures we are not encouraging you to avoid paying this tax. It's just that you should be aware of this common practice and therefore understand why the paperwork for used cars is so complicated as a result of this practice. Your sponsoring company will undoubtedly have a policy and recommendations on how you should handle this situation.

This common practice makes the actual invoice a very important document. If there is an incident involving a car, the kwitansi pembayaran/invoice will be necessary to prove the current ownership of the vehicle. You would not want to be held liable for an accident which involved a car you used to own; your copy of the invoice would prove the car was no longer yours.

When a customer wants to buy a used car they should present:

1. KTP (Kartu Tanda Penduduk/Identity card) Depending upon the selling party they may or may not accept other forms of identification (i.e., passports or ITAS /Limited Stay Permit Card).

2. Cash or means of financing the vehicle. (Please refer to the financing notes ).

Upon completion of the transaction the customer should receive the following documents:

a. STNK (Surat Tanda Nomor Kendaraan/Registration)
b. BPKB (Buku Pemilik Kendaraan Bermotor/Proof of ownership book)
c. Faktor (original invoice for the car when it was purchased from the manufacturer)
d. Kwitansi Blangko - 3 lembar (3 copies of a receipt)
The first copy of the kwitansi blangko should contain the following information:
a. Jenis Mobil (type of car)
b. Warna (color)
c. Nomor Polisi (license plate number)
d. Nomor Chasis (chasis number)
e. Nomor Rangka (frame number)
This first copy should be signed by the person whose name appears in the BPKB on top of a Rp 6,000 meterai (Rp 6,000 tax stamp).

The second and third copy of this receipt should be left blank except for the signature of the original owner, whose name appears in the BPKB. No meterai is required. These copies would be required by the Department of Motor Vehicles in the event that the name in the BPKB was to be changed. It is very important to have these three copies! Otherwise it may be difficult to resell your vehicle in the future. In doing the research for this piece we could not find out why the blank copies were needed as none of the Indonesians we talked to had ever balik nama.

5. Kwitansi or Tanda Terima (receipt for the transaction) This receipt will include the amount of money that was paid for the vehicle.

6. Photocopy of KTP (identity card) (and in the case of a foreign resident the ITAS ) for the person whose name appears on the BPKB. This will be needed to renew the yearly registration for the vehicle (STNK). Pay close attention to the expiration date on the KTP. If the KTP is expired, it cannot be used to renew the annual STNK. You will then need to track down the owner and get a photocopy of his valid KTP.

Sources for Used Cars

Classified listings for cars can be found on the Living in Indonesia Expat Forum

There's always a good selection of used cars advertised in the classified section of Kompas newspaper. There is a place at Kemayoran, it is like a showground with many dealers there. You can walk around and check out the cars. Good place to start.

Be careful if you're buying a used car direct from the previous owner. Get photocopies of all the documents and go to the police to check to make sure the car has never been stolen. Don't let the owner come with you; if he's genuine he won't be offended. Ask the police for a report showing you've checked the ownership history of the car. You'll have to pay an unofficial fee but it's well worth it.

Renewing your STNK

Again, your agent, or a Biro Jasa, can assist you in your yearly renewal of your vehicle's STNK. You will not receive a notice of the expiration of this document, your driver should help you to remember when it expires. Be careful not to let this document expire as there is a heavy fine if you are caught driving your car with an expired STNK. This fine is based on the make and year of your car, with newer and more expensive cars getting a higher fine. The amount for renewing the STNK appears on the back of the STNK document. Upon receipt of your new STNK you will be given stickers which can then be applied to your old license plates.

2010 regulation governing prices for STNK renewal

If you want to renew your STNK yourself (instead of going through a Biro Jasa), go to:

Direktor Lalu Lintas Bagian STNK
Polda Metro Jaya (Komdak)
Jl. Jenderal Sudirman
Jakarta Selatan
Bring with you: (April 2015)
  1. Your original STNK
  2. Your original BPKB
  3. Photocopies of the BPKB
  4. Original passport (for foreign owners)
  5. Original Police card
  6. The current original ITAS/ITAP/KTP of the person whose name appears on the STNK
  7. A copy of the "Surat Keterangan Domisili"
  8. If you are buying your car on credit, you will need a letter from the creditor explaining the car being purchased through a credit agreement.
  9. The required payment

Renewing the STNK for a motorcycle (April 2015)

  1. Your original STNK
  2. Original passport (for foreign owners)
  3. The current original ITAS/ITAP/KTP of the person whose name appears on the STNK.

Car Insurance

Be sure, before you purchase your car, that you can get auto insurance for it in Indonesia. You may have some difficulties on older models. Several of the foreign insurance companies operating in Indonesia may offer auto insurance, you just need to call around and checkw ith them. For more information on auto insurance companies, see Insurance in Indonesia.

Purchasing a Car if you don't have your NPWP yet

Purchasing a new car with value Rp >400M usually gets a NPWP question during initial registration. As a newly arrived expat the NPWP usually lags significantly more than the other needed papers, so be prepared for another "administrative" fee to pay in order to get your car and correct papers for it.

Read our related article on Making a Drivers License in Indonesia.

Housing and schooling information for expats in Indonesia expatriate website for Indonesia Indonesian language translation of article

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