BERITA TERKINI
JAKARTA, DDTCNews - There will be no increase in tax rates in 2026. This assurance was conveyed by the Minister of Finance, Sri Mulyani Indrawati, during a recent joint working meeting with Committee IV of the Presidential Advisory Council of the Republic of Indonesia (Dewan Pertimbangan Presiden Republik Indonesia/DPT RI in Indonesian).
This topic stood out as one of the most-discussed tax developments over the past week.
The government highlights that there are no plans to raise tax rates next year to achieve the 2026 tax revenue target and overall state revenue target.
According to Sri Mulyani, the government will instead focus on stricter enforcement and boosting taxpayer compliance to optimise revenues next year. She expressed confidence that such measures would boost the state’s fiscal capacity.
“Given the nation’s extensive needs, state revenue must continuously be strengthened without enforcing any new policies. Media reports often frame this as an increase in tax burdens, whereas in reality, tax rates remain unchanged,” she explained.
On another note, the proposed tax revenue target in the 2026 draft state budget (rancangan anggaran penerimaan dan belanja negara/RAPBN in Indonesian) stands at IDR2,357.68 trillion, marking a 7.69% rise from the 2025 state budget (anggaran penerimaan dan belanja negara/APBN in Indonesian) target. In contrast, 2026 state revenues are targeted at IDR3,147.7 trillion, up 4.75% compared to the 2025 state budget target.
To achieve these ambitious revenue targets, Sri Mulyani reiterated that the government’s approach will centre on intensifying tax enforcement measures and enhancing taxpayer services to increase taxpayer compliance.
“Enforcement and compliance will be streamlined and improved, enabling those with the capacity and obligation to pay taxes to do so with ease and in full compliance. At the same time, those who are less well-off and vulnerable will receive maximum support,” Sri Mulyani stated.
Sri Mulyani highlighted the government’s relief measures for micro, small and medium enterprises (MSMEs or usaha mikro, kecil, dan menengah/UMKM in Indonesian) entrepreneurs. MSME taxpayers whose turnover is less than IDR500 million a year are not subject to income tax.
On the other hand, the turnover of MSMEs between IDR500 million and IDR4.8 billion per year is subject to a final income tax of 0.5%. According to her, this scheme clearly demonstrates the government’s pro-MSME stance.
Beyond the assurance of no tax rate hikes, several other developments also merit attention. These include Sri Mulyani's response to the country’s increasingly heated political climate, ongoing confusion surrounding government-borne value tax (VAT) and renewed discussions on a potential wealth tax.
Sri Mulyani shared a personal message on her personal Instagram addressing the ongoing unrest.
In a series of demonstrations within the last few days, the mob also looted Sri Mulyani's residence located in Bintaro, South Tangerang.
Sri Mulyani reflected that building Indonesia has always been a challenging, steep, often risky and demanding journey. Past leaders had endured similar struggles.
Under the Minister of Finance Regulation (MoF Reg.) 60/2025, the government grants an incentive to the public in the form of government-borne (ditanggung pemerintah/DTP in Indonesian) VAT for home purchases, effective until December 2025.
However, the regulation provides for several conditions under which taxpayers cannot take advantage of the government-borne VAT incentive for home purchases. Thus, the general imposition of VAT applies to the supplies of such houses.
“Supplies of the landed houses or flat units referred to in paragraph (1) are subject to VAT pursuant to statutory provisions in the field of taxation,” reads Art. 9 paragraph (2) of MoF Reg. 60/2025.
The Ministry of Finance claims that households are the primary beneficiaries of tax incentives.
Deputy Minister of Finance, Anggito Abimanyu, reported that tax expenditure this year is projected at IDR530 trillion. Of this total, approximately IDR292 trillion, or 55%, is disbursed for incentive policies targeting the wider community.
"Tax incentives or tax expenditure in 2025 are estimated at IDR530 trillion. Out of this amount, 55% or IDR292 trillion is enjoyed by households," he said.
The implementation of the global minimum tax (GMT) serves as a ‘safeguard’ to prevent multinational companies (MNEs or perusahaan multinasional/PMN in Indonesian) from engaging in aggressive tax planning by exploiting loopholes in international tax provisions.
Senior Specialist of DDTC Fiscal Research and Advisory (FRA), Hamida Amri Safarina, explained that global anti-base erosion (GloBE) rules are designed to address profit shifting and the global race to lower corporate income tax rates. This mechanism works by imposing a top-up tax if the effective rate borne by MNEs in a jurisdiction falls below 15%.
“In summary, GMT represents a top-up tax on MNE groups whose effective tax rate in a jurisdiction is under 15%,” explained Hamida during an Instagram live session with the Tax Center of the University of Mataram.
The Prosperous Justice Party (Partai Keadilan Sejahtera/PKS in Indonesian) urges the government to undertake a feasibility study concerning the wealth tax.
According to the Chairperson of the Central Executive Board (Dewan Pengurus Pusat/DPP in Indonesian) of the Prosperous Justice Party for Economy, Finance and Industry Handi Risza, the implementation of wealth tax warrants consideration given Indonesia’s relatively low tax ratio.
“Despite the increase in tax revenues in nominal terms, the growth of tax revenues has not outpaced nominal GDP growth. Hence, the tax ratio has actually declined,” he added. (sap)
