The challenges of Indonesia business formation for foreign investors are highlighted in the 2008 Doing Business Survey by the World Bank, where erratic law enforcement, unclear official business set up procedures and costs combine to give Indonesia a low rank of 129th. Indonesia fares little better in the 2007 Corruption Perceptions Index by Transparency International, where it ranks as just the 126th least corrupt country in the world.

Furthermore, Indonesia is negatively ranked the world's 119th freest economy in the Heritage Organisation’s 2008 Index of Economic Freedom, which rates a country for the freedom offered in trade, financial, investment and labour markets. Indonesia is also poorly ranked as the world's 54th most competitive economy in the World Bank's Global Competitiveness Report 2007-2008.

To minimise the frustrations of starting a business in Indonesia highlighted in the poor survey rankings above, the majority of international investors engage the services of a professional corporate consulting Firm. This Firm will project manage all aspects of business set up, from company incorporation to bank account opening, as well as organising work and residence visas for the investor, his family and expatriate staff.

Unfortunately, an Indonesian business suffers 30% tax on income sourced both in Indonesia and worldwide. Capital gains are taxed at up to 30%. That said, it is possible to access the network of double tax treaties Indonesia has signed with countries around the world. A double tax treaty is signed by two countries to prevent the duplicate taxation of international income. In addition, a double tax treaty reduces withholding tax on payments to non-resident individuals and companies. Following Indonesia business formation, most businesses are required to submit an annual tax return and audited financial statements.