One in five smartphones in Indonesia is sold illegally, making the government lose revenue from tax on the devices and exposing consumers to security breaches, an ongoing study by the Ministry of Industry and American semiconductor producer, Qualcomm, reveals. (Investor Daily/Emral)

One in Five Smartphones in Indonesia Is Illegal

BY :RAHAJENG KH

APRIL 08, 2017

Jakarta. One in five smartphones in Indonesia is sold illegally, making the government lose  revenue from tax on the devices and exposing consumers to security breaches, an ongoing study by the Ministry of Industry and American semiconductor producer, Qualcomm, reveals.

The study compared the numbers in Qualcomm databases with 15-digit International Mobile Equipment Identity (IMEI) codes for smartphones circulated in Indonesia, and found that 20 percent of the devices use IMEI codes from old phones.

The government requires every smartphone to have the identity code. Mobile phones are subject to a 10 percent value added tax and an additional 7.5 percent import tax, if bought abroad.

Duplicated IMEIs make it easier for cyber criminals to operate, said I Gusti Putu Suryawiryawan, the ministry's director general for technological equipment.

"This study is part of our efforts to deal with the growth of technology," Putu said in a recent interview, adding that the government is going to pursue the research to find a way to contain IMEI cloning.

Indonesia is seeing a rapid increase in smartphone usage.

Last year, more than 130 million Indonesians were accessing internet content from their mobile phones, up from 88 million in 2014, according to a biannual survey by the Indonesian Internet Service Providers Association, or APJII.

The government tries to take advantage of the trend by requiring smartphone companies to produce some components of the devices locally or conduct research in Indonesia.

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