MoHA: Local Tax Collection Incentive Regulation to Be Revised

JAKARTA, DDTCNews - The Ministry of Home Affairs (MoHA) has stated that the government will shortly revise Gov. Reg. 69/2010 concerning procedures for the granting and utilisation of incentives for the collection of local taxes and user charges.

The Director General of Local Finance Development at the MoHA, Agus Fatoni, said the revision of Gov. Reg. 69/2010 is currently at the discussion stage. He noted that the government also understands local governments' aspirations for Gov. Reg. 69/2010 to be updated promptly following the entry into force of the Law on Financial Relations between the Central Government and Local Governance (HKPD).

"Regarding the aspirations put forward, whereby Gov. Reg. 69/2010 has not yet been revised, we need to report that the revision process is underway and currently in discussion," he said, as quoted on Monday (6/7/2026).

Fatoni's statement was made in response to the aspirations of the Indonesian Association of Deputy Regional Heads (Asosiasi Wakil Kepala Daerah/ASWAKADA in Indonesian), which has called on the government to promptly issue new regulations to replace Gov. Reg. 69/2010. The MoHA and ASWAKADA met at a joint hearing with Commission II of the House of Representatives (Dewan Perwakilan Rakyat/DPR in Indonesian).

Fatoni noted that the MoHA is allowing local governments to provide input on the substance of the revision to the Gov. Reg. 69/2010. These various proposals will subsequently serve as materials in the drafting of the regulation.

"Of course, any input relating to the substance of the government regulation or the revision of Gov. Reg. 69/2010, if there are aspirations, proposals or suggestions, will become our materials in revising that government regulation," he said.

Previously, the Secretary General of ASWAKADA Indonesia, Selle KS Dalle, said that many local governments are planning to revise the provisions on procedures for the granting and utlisation of incentives for the collection of local taxes and user charges. A number of local governments have even begun drafting head of the region regulations, but no new government regulation is yet available to serve as guidelines.

Selle, who is also the Deputy Regent of Soppeng, said local governments require legal certainty regarding which parties are entitled to receive incentives, the amount of incentives and the mechanisms for granting them. Without a regulatory update, local governments are concerned that policies issued at the regional level could potentially become audit findings.

"We must not be in a position where we adopt a regulation at the local level only for it to ultimately become a legal loophole for us, whether during a regular audit by an audit institution, which ultimately becomes a legal problem," he said.

On another note, Gov. Reg. 69/2010 stipulates that regency/municipal governments may disburse incentives of up to a maximum of 5% of local tax and user charges revenues. For provincial governments, the incentive is set at a maximum of 3% of local tax and user charges revenues.

Incentives are granted to the implementing agencies responsible for collecting local taxes and user charges. These incentives are paid proportionally to 5 parties.

First, officials and employees of the implementing agencies responsible for collecting local taxes and user charges, according to their respective responsibilities. Second, the head of the region and the deputy head of the region, as the persons in charge of managing local finances.

Third, the local secretary acting as coordinator of local financial management. Fourth, land and building tax (L&B Tax) collection agents at the village/subdistrict and district levels, the village head/subdistrict head or equivalent title and the head of district and other personnel assigned by the implementing tax collection agency.

Fifth, other parties that assist the implementing agencies responsible for collecting local taxes and user charges. (dik)