PERSONNEL EXPENSES 2011 OPERATIONS, MAINTENANCE AND TELECOMMUNICATION SERVICES EXPENSES 2011

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS continued DECEMBER 31, 2011 AND 2010, AND YEARS ENDED DECEMBER 31, 2011 AND 2010 Figures in tables are presented in billions of Rupiah, unless otherwise stated 70

31. TAXATION continued

e. continued The reconciliation between income before tax attributable to the Company and the estimated taxable income for the years ended December 31, 2011 and 2010, are as follows: 2011 2010 Income before tax attributable to the Company 11,700 12,694 Less: income subject to final tax 462 633 11,238 12,061 Temporary differences: Amortization of intangible assets and land rights 9 1,006 Depreciation and gain on sale of property, plant and equipment 479 1,129 Provision for impairment and trade receivables written-off 139 11 Foreign exchange gain on deferred consideration for business combinations 31 Net periodic pension and other post-retirement benefits costs 45 299 Payments of deferred consideration for business combinations 106 1,204 Accrued early retirement benefits - 1,029 Deferred installation fee 86 87 Provision for impairment of assets 563 - Other provisions 4 46 Total temporary differences 81 2,830 Permanent differences: Net periodic post-retirement health care benefit costs 199 229 Equity in net income of associates and subsidiaries 8,925 8,201 Others 975 1,226 Total permanent differences 7,751 6,746 Taxable income 3,568 2,485 Current corporate income tax expense 714 497 Final income tax expense 63 61 Total current income tax expense of the Company 777 558 Current income tax expense of the subsidiaries 4,896 4,111 Total current income tax expense 5,673 4,669 70 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS continued DECEMBER 31, 2011 AND 2010, AND YEARS ENDED DECEMBER 31, 2011 AND 2010 Figures in tables are presented in billions of Rupiah, unless otherwise stated 71

31. TAXATION continued

e. continued The Tax Law No. 362008 stipulates a reduction of 5 from the top rate applicable to qualifying companies listed, and for whose stock is traded on, the IDX which meet the prescribed criteria that the public own 40 or more of the total fully paid and traded stocks on the IDX, and such stocks are owned by at least 300 parties, with each party owning less than 5 of the total paid-up stocks. These requirements must be met by a company for a period of 6 months in one tax year. The Company has met all of the required criteria, therefore, for the purposes of calculating income tax expenses and liabilities for the financial reporting periods of December 31, 2011 and 2010, the Company has deducted its applicable tax rate by 5. The Company applied a tax rate of 20 for the fiscal year 2011 and 2010. The subsidiaries applied a tax rate of 25 for the fiscal year 2011 and 2010. The Corporate Income Tax Return “Surat Pemberitahuan Tahunan” or “Annual SPT” for the fiscal year 2011 will be reported based on the prevailing regulation. The amount of corporate income tax for the years ended December 31, 2010 was as reported in the Annual SPTs. f. Tax assessment i The Company Directorate General of Tax “DGT” has audited the Company’s corporate income tax overpayment amounting to Rp.255 billion on 2008 fiscal year. On June 16, 2010, DGT issued an Overpaid Tax Assessment Letter “Surat Ketetapan Pajak Lebih Bayar” or “SKPLB” on corporate income tax amounting Rp.228 billion. The difference between SKPLB and the Company’s claim for tax refund has been charged to 2010 consolidated statement of comprehensive income amounting to Rp.27 billion. The Company received an Underpaid Tax Assessment Letter “Surat Ketetapan Pajak Kurang Bayar” or “SKPKB” on VAT amounting to Rp.1.69 billion including a tax penalty of Rp.0.5 billion which has been net off with SKPLB of income taxes. Therefore, the Company received restitution from DGT amounting to Rp.226.5 billion. On July 9, 2010, the Company has received a refund from a claim of SKPLB on 2008 fiscal year corporate income tax. As of the issuance date of the consolidated financial statements, the audit of withholding income tax for 2008 fiscal year is still in process. ii Telkomsel On February 25, 2009, the Tax Authorities filed a judicial review to the SC for the Tax Court’s acceptance of Telkomsel’s appeal for a refund of withholding taxes covering the fiscal year 2002 of Rp.115 billion. On April 3, 2009, Telkomsel filed a contra-appeal to the Indonesian Supreme Court “SC”. As of the issuance date of the consolidated financial statements, it is still in process.