IMEI Blocking - How to get around the system to make it fairer.

As recently as the 18th of April 2023 the Indonesian Government has taken on blocking new phone IMEI. IMEI (pronounced "eye-me-eye") essentially stands for International Mobile Equipment Identity. This IMEI is sent with every text message, every phone call, and when using data to show the identity of the phone. At some stage when you purchased the phone your name was put to that IMEI to register the product. Under the guise of "curbing the circulation of illegal phones" the Indonesian Government has created a system in which it can block any IMEI that was not sold (therefore registered) in Indonesia. “The government is committed to implementing the IMEI controlling with a white list scheme or preventive measures so people can determine the legality of certain devices before buying them” said Communications and Information Ministry director general for resources and postal and informatics devices, Ismail, in Jakarta on Friday.

This article was published in thejakartapost.com with the title "No more illegal phones: Indonesia to impose IMEI control regulation on April 18". Click to read: https://www.thejakartapost.com/news/2020/02/28/no-more-illegal-phones-indonesia-to-impose-imei-control-regulation-on-april-18.html. If you register your new phone before April 18th you have nothing to worry about according to the Minister. Here is what occurred to me when trying to use my legally purchased iPhone14 in Australia. I purchased a new iPhone 14 in Australia from a legitimate Apple store. I buy Apple phones from a legitimate Apple store because they come with a two year warranty in Australia. There is nothing "illegal" about my phone. I paid $1899 AUD for a standard iPhone 14 with 512 memory. (Really, in retrospect I needed to buy the iPhone 14 Pro, however this is another conversation for another day). I paid tax in my own country of 10% GST. This means I paid $1726.36 plus 10% Goods & Services Tax or what we call "GST"; total $1899.00. Nothing illegal, all legitimately paid for. I have had an Indonesian sim card since 2015 for the business. Then number was +62 812 3787 0220. I kept up the payments on this sim card every month during Covid for two years while I didn't need it just to keep the number alive. I flew into Bali in April 2022 after Covid and of course the number worked as usual. My iPhone 11 Pro is a dual sim phone so when I got back to I just change the priority sim to Indonesia. I came back to Bali many times over the next year to get the business going again. (Tourism takes awhile to get started. It was like starting from scratch only you had a pile of contacts in your pocket on your phone you could call on to help get the business started again.) I then flew back to Australia when my iPhone 11 Pro developed a problem. The screen went all twitchy and Apple said it would cost me something like $850 AUD to fix, so I thought I would get a new phone and bring the iPhone 11 Pro to Bali and get it fixed in Bali for a lot cheaper than this price. The new iPhone 14 with 512 of memory was purchased. I have the new phone for less than a day and I had to take it back as it wasn't performing well. Without even skipping beat Apple just pulled out a new phone and said "Here, take this one instead" now that's why I buy from an Apple store. That service. I fly back to Bali with the new iPhone 14 and my broken iPhone 11 Pro. However on the custom's declaration is something new. https://ecd.beacukai.go.id

Notice what is written in red "Foreigners who are going t stay less than 90 days in Indonesia, will not be necessary to register your IMEI" As I was only staying for five weeks, I skipped this section. When I Ianded in Bali I couldn't get my old Indonesian phone number to work. I couldn't understand why. I got online when I got to the office using wifi and found out about this new IMEI blocking thing. "Okay," I thought "I'll just go to Telkomsel tomorrow and get this sorted out." (Telkomsel is the name of the mobile phone carrier I use in Indonesia) The next day, within 16 hours of landing in Bali I was at Telkomsel. "Hey my phone is not working on a number. I have had this phone number for years Can you please get this working?" The response was "Sure we have to unblock your IMEI. Can I please have your passport?" I gave the Telkomsel guy my passport "Oh, you have KITAS, I'm sorry sir you have to go to immigration" None to happy and knowing it is pointless to protest with these people, I went to immigration near the airport. (KITAS is a form of visa that allows me to invest in Indonesia and allows me to stay longer than a standard tourist visa if I choose too.) Upon arriving at immigration near the airport I was told I had to pay a tax on my new iPhone so they could unblock the IMEI. I was told this process has been known to take up to seven days. So not only would I have to pay a tax, I wouldn't be able to use my phone for seven days either. I'm only staying for five weeks. So I thought to myself, "The Indonesian government must be protecting a distributor here that is now bringing in iPhones, I sort of understand so let's just pay this tax and get out of here" and then I was told the price of the tax. I was told there was a 21% tax for something, 10% tax for something else, and 10% tax for something else. All up 41% tax on a phone I have already paid tax on. The initial calculation of tax went like this: 1. What is the type of phone? - Apple 2. What is the model of the phone? - iPhone 14 3. What is the capacity of the phone? - 512 gig Okay you paid for your phone $1899.00 AUD that is (let's just say "19 million IDR" to keep this easy) you must pay 41% of that, so you have to pay 7.79 million ($779 AUD) as a tax to use my own phone. Okay, at this point there is no way I'm paying tax on my phone that is the equivalent to two months wages for an Indonesian worker, just so I can use my own phone.

What are my options: 1. I can buy a cheap smart phone, get a cheap sim card, and hotspot my phone. 2 million max. ($200 AUD) 2. I could go through this process and try to understand the system. I chose option 2. I started to go through the process. My first question. Me: "Don't I get the first $500 USD tax free?" Immigration:"Yes but only at the airport when you first land. Too late now." Me: "But its been less than 20 hours since I arrived, not even one day, and there were no signs at the airport about this." Immigration: "Sorry mister, no tax free after you leave the airport" Okay, so my thinking is now, do I fly out to Singapore and back in a day spend $400 AUD to save $500 in taxes? Thats an option, or I could pay this tax when I come back. Let's see what else comes up. Me: "It says on the Customs Declaration form not to fill out the the IMEI stuff in bold red if you are staying less than 90 days"

Immigration: "Yes, but you have KITAS" Me: "Okay so why doesn't the wording in red say"Foreigners who are going to stay less than 90 days in Indonesia, will not be necessary to register your IMEI .... unless you have KITAS"

Immigration: "Mister, when I go to your country, I must know the rules, when you come to my country, you must know the rules" Me: "So I'm supposed to Google search before I come to Indonesia "Has the Indonesian government created a new tax where they charge me 41% tax on my new phone?" is that really what you're saying I should have done before I left? How would anyone know to check for this? No other country that I know of does this. Can you name another country that does this? My phone was purchased legally."

Immigration: "If I go to your country....." Me: "Forget it, let's just get through this process"

The process starts again at a different desk. The new immigration guy at another desk I start going through the questions the immigration officer is asking and while ticking things off on the screen that I can see, however I can't read because it's in Indonesian. However, I spot something on the screen I do recognise, an acronym NPWP. This is tax number we get in Indonesia. I said "Do you want that NPWP number?" The immigration guy said I wouldn't have that number. I then pull the card out of my wallet and when he puts the number into the computer my tax amount drops by 10%. So now my tax on my phone looks like 11%, 10% and 10% which of course equals 31%. In a few minutes I have gone from 7.79 million to 5.89 million. So I've just saved 1.9 million. More than half of a weekly wage for a local Indonesian. I was feeling invigorated, let's continue and see what else I can find as I go through this process. I then said. "Hang on, you can't put a tax on top of a tax right?" to which immigration officer replied "They are not "on top" that are all together, equals 31% not 10% plus 10% on top, nooo" That's when my reply was "However, I paid 1.9 million IDR tax in Australia. The real; price of the phone is 17,263,600 plus 10% for the Australian tax so we have to work this out on 17,263,600 because otherwise it is a tax on a tax. To my surprise the immigration guy agreed and accepted this new total. My first thought was "Look how many people are hear paying extra tax on a tax they have already paid in another country, when all they have to do is state this little fact to save money. So now I'm at 31% of 17,263,600 = 5,351,716. I have saved 2,438,284 IDR in about 10 minutes. Let's keep going, this is starting to be fun.

Next I read the sign carefully while I was waiting as the information was being put into the computer at immigration. "the VALUE of the phone" not "the PRICE of the phone." So I jumped online on Gumtree in Australia while waiting and found an iPhone 14 second hand for $1000 AUD. I showed the immigration guy the "value" of the iPhone if I had to sell the phone. I said "Your sign says I must pay tax on the 'value' of the phone. Here is one for sale in Australia for $1000" Immediately the immigration guy agrees, the sign does in fact say the value of the phone, and drops the price down to 10,000,000 IDR on the screen. Now I'm down to 31% of 10,000,000. That's 3,100,000 IDR, or $310 AUD. From $779 to $310 in about 15 minutes, or $31.26 a minute. So, before I handed over the payment I thought. I could get a tourist sim for 400,000 IDR ($40 AUD) that will last me my five weeks and give me 25 gig of data. Plenty. Then come back in a few months when the prices of the iPhone have dropped because the iPhone 15 must be being released soon enough. Then I could come back to Bali with the $500 USD tax free at the airport and get this phone in for free. I'll just bring a Gumtree advertisement showing the iPhone 14 at being under $500 USD worth. Back in Australia my iPhone 14 developed another problem. I took it into Apple, they couldn't fix it, so they gave me a new phone. New phone, great right? Only now... I have a new IMEI. I would have paid that tax for nothing. Because I technically have a new phone, (there is no way that Indonesian Immigration is going to believe I have a 'replacement' phone) I would have to have paid that tax again. I fly back to Bali in a few months, new phone and an advertisement from Gumtree showing I purchased my iPhone 14 for under $500 USD. $779 tax down to $40 for a sim card with 25 gig of data in 20 minutes.