"Crypto assets will be subject to VAT because they are a commodity as defined by the trade ministry. They are not a currency," the official, Hestu Yoga Saksama, told a media briefing. "So we will impose income tax and VAT."
This decision of the Ministry of Commerce of Indonesia is caused by the fact that they do not want to recognize cryptocurrency as a digital kind of money. It is possible that it is advantageous for them to consider cryptocurrency as a commodity, since in this case they can get additional income by charging value-added tax.
There are a lot of countries today who are not ready to recognize bitcoin as a currency, they would rather see it as a commodity that people can only buy and sell, and not a currency that would be used for transactions. Like you have said, when a government recognizes an asset as a commodity, investors of that asset would have to be paying income tax and VAT (value added taxes).
Anyways, we know that this isn’t much of a big deal, compared to what we have seen happening in India where the government is charging investors up to 30% tax. Such a huge amount of tax is likely to cripple the community in that particular country. But as usual, people would always get around this.