6 ms·

Bali's new digital nomad visa means foreigners can live and work tax free

41 points by imartin2k 4y ago

hunglee2 4y ago
next front in the 'war for talent', countries which have suffered tourism collapse will replace it with digital nomad economy. This move by Indonesia most aggressive so far, expect others to follow
- Melting_Harps 4y ago
  > next front in the 'war for talent', countries which have suffered tourism collapse will replace it with digital nomad economy. This has been in the works for some time, actually; the need to offset an aging or out of work/underemployed populace has been a thing for some time--COVID just exposed and expedited it's deployment. Personally speaking as a digital nomad, and an obvious bias, it's been a long time coming. > This move by Indonesia most aggressive so far, expect others to follow It is the longest lasting one by duration, as Portugal offers 3 year DN visa via D7 and then a 2 year extension, but Portugal has a path to PT (and therefore EU) citizenship after 5 years. So in terms of interrogation it's hardly the most aggressive where they need a way to offset their debt to GDP ratio (over 100% since 2008 which is coupled with 20+ years of brain drain). Bali has it's benefits, it's a Low cost of living and an amazing culture and cuisine to explore, but Bali has a reputation much like Boulder: and for those of use who have already spent time there we'd rather 'wait and see' how this plays out. I'm a big fan of Bali, but it's the people who go there that I have an issue with, especially in the age of the enlightened influencer jetting off to Ubud for morning yoga sessions sponsored by Lululemon. It's pretty gross, and that bastardization has changed the landscape significantly over the years but things like Green School are an example of where things can go right when the funds are re-directed: their curriculum has enviormental entrepreneurialism at it's core. It was always a goal of mine to spend some time there, even if it's just cooking for the kids. Either way, this is cool, but I'd like to see some more incentives before I decide to pull the trigger as I'm already a DN in the EU.
  - kikowi 4y ago
    Where are you located as digital nomad in EU?
    - Melting_Harps 4y ago
      > Where are you located as digital nomad in EU? HR > There's also a digital nomad visa option in Croatia too AFAIU. It is, and I'm there as I write this, but there is no path to citizenship and it's a yearly process.
  - menaerus 4y ago
    There's also a digital nomad visa option in Croatia too AFAIU.
chpmrc 4y ago
“Tax free” is deceptive, if it’s only referred to foreign sourced income. Income from any work is considered sourced where the work is performed, so this would only apply to foreign passive income (e.g. dividends or capital gains). And I’m not familiar with CFC-like rules in Indonesia but I guess they also apply some kind of economic substance requirement for a tax resident to own a company incorporated somewhere else and whose only purpose isn’t tax optimization.
- danielfoster 4y ago
  Maybe I read the article incorrectly, but it specifically states that income derived from foreign businesses is tax-free. So this should include any freelance work or employment with a foreign entity as well as business profits derived abroad. I don't think the "butt in seat" rule applies here. It is a good idea to bring this up in any case, because there could be other tax implications, especially for Americans unaware that they will be paying tax on income above $108,700.
  - chpmrc 4y ago
    It doesn't matter where the employer/client is located. Income is taxed _where the work is performed_. If you work in Indonesia that's where your income will be taxed. "Business profits" are different, since they are generally regarded as dividends distributed to shareholders who (in theory) don't "do work" for the company.
- leephillips 4y ago
  And it only refers to taxes paid to Indonesia. US citizens still have to pay federal tax to the US (every country is different, but the US is unusually harsh in this regard).
  - swyx 4y ago
    not sure why this was downvoted - the global US tax is a thing that citizens have to deal with
Proven 4y ago
gumby 4y ago
Despite this article’s relentless emphasis on Bali, this visa, unsurprisingly, appears to apply to the whole country.
FerretFred 4y ago
I'd like to be reassured that the Internet infrastructure is fit for purpose, and also that the Government don't intend to keep switching off the Internet when there's an election, exam season etc.

41 points by imartin2k 4y ago

next front in the 'war for talent', countries which have suffered tourism collapse will replace it with digital nomad economy. This move by Indonesia most aggressive so far, expect others to follow

Melting_Harps 4y ago
> next front in the 'war for talent', countries which have suffered tourism collapse will replace it with digital nomad economy. This has been in the works for some time, actually; the need to offset an aging or out of work/underemployed populace has been a thing for some time--COVID just exposed and expedited it's deployment. Personally speaking as a digital nomad, and an obvious bias, it's been a long time coming. > This move by Indonesia most aggressive so far, expect others to follow It is the longest lasting one by duration, as Portugal offers 3 year DN visa via D7 and then a 2 year extension, but Portugal has a path to PT (and therefore EU) citizenship after 5 years. So in terms of interrogation it's hardly the most aggressive where they need a way to offset their debt to GDP ratio (over 100% since 2008 which is coupled with 20+ years of brain drain). Bali has it's benefits, it's a Low cost of living and an amazing culture and cuisine to explore, but Bali has a reputation much like Boulder: and for those of use who have already spent time there we'd rather 'wait and see' how this plays out. I'm a big fan of Bali, but it's the people who go there that I have an issue with, especially in the age of the enlightened influencer jetting off to Ubud for morning yoga sessions sponsored by Lululemon. It's pretty gross, and that bastardization has changed the landscape significantly over the years but things like Green School are an example of where things can go right when the funds are re-directed: their curriculum has enviormental entrepreneurialism at it's core. It was always a goal of mine to spend some time there, even if it's just cooking for the kids. Either way, this is cool, but I'd like to see some more incentives before I decide to pull the trigger as I'm already a DN in the EU.
- kikowi 4y ago
  Where are you located as digital nomad in EU?
  - Melting_Harps 4y ago
    > Where are you located as digital nomad in EU? HR > There's also a digital nomad visa option in Croatia too AFAIU. It is, and I'm there as I write this, but there is no path to citizenship and it's a yearly process.
- menaerus 4y ago
  There's also a digital nomad visa option in Croatia too AFAIU.

chpmrc 4y ago

“Tax free” is deceptive, if it’s only referred to foreign sourced income. Income from any work is considered sourced where the work is performed, so this would only apply to foreign passive income (e.g. dividends or capital gains). And I’m not familiar with CFC-like rules in Indonesia but I guess they also apply some kind of economic substance requirement for a tax resident to own a company incorporated somewhere else and whose only purpose isn’t tax optimization.

danielfoster 4y ago
Maybe I read the article incorrectly, but it specifically states that income derived from foreign businesses is tax-free. So this should include any freelance work or employment with a foreign entity as well as business profits derived abroad. I don't think the "butt in seat" rule applies here. It is a good idea to bring this up in any case, because there could be other tax implications, especially for Americans unaware that they will be paying tax on income above $108,700.
- chpmrc 4y ago
  It doesn't matter where the employer/client is located. Income is taxed _where the work is performed_. If you work in Indonesia that's where your income will be taxed. "Business profits" are different, since they are generally regarded as dividends distributed to shareholders who (in theory) don't "do work" for the company.
leephillips 4y ago
And it only refers to taxes paid to Indonesia. US citizens still have to pay federal tax to the US (every country is different, but the US is unusually harsh in this regard).
- swyx 4y ago
  not sure why this was downvoted - the global US tax is a thing that citizens have to deal with

Proven 4y ago

gumby 4y ago

Despite this article’s relentless emphasis on Bali, this visa, unsurprisingly, appears to apply to the whole country.

FerretFred 4y ago

I'd like to be reassured that the Internet infrastructure is fit for purpose, and also that the Government don't intend to keep switching off the Internet when there's an election, exam season etc.