Government Considers 0% Tax Incentive for 50 Years at the IIFC
JAKARTA, DDTCNews - Chairperson of House of Representatives Commission XI, Mukhamad Misbakhun, has revealed that the government is considering granting tax incentives for 50 years to entrepreneurs operating at the Indonesia International Financial Centre (IIFC).
Misbakhun said the tax incentive offered would take the form of a 0% income tax rate applied for up to 50 years. In his view, the incentives offered by Indonesia's financial centre would attract the interest of major investors.
"Of course, we will provide a wide array of incentives. The government will offer a 0% tax rate for up to 50 years. Personally, I think [the incentive] should remain in place as long as the IIFC exists, but the government considers 50 years," he said, as quoted on Thursday (16/7/2026).
Misbakhun deems the granting of tax incentives at a financial centre for 50 years to be reasonable, given that the financial sector will continue to grow and become increasingly sophisticated and modern over the long term.
He is confident that the incentives being prepared at the financial centre will attract not only investors but also other financial sector participants, such as private banks and the Association of State-Owned Banks (Himpunan Bank-Bank Milik Negara/Himbara in Indonesian), investment companies, securities firms and so forth.
"Our hope is that those who have been spreading their investments, perhaps in the British Virgin Islands, the Cayman Islands and Labuan [tax havens], can repatriate and invest here, rather than travelling all the way to those destinations," he claimed.
In addition to tax incentives, Misbakhun revealed that there are several other concessions available to investors and entrepreneurs at the financial centre, for example, ease of using foreign currencies, financial statements in foreign languages and ease of establishing a business.
To date, he continued, the government and House are still deliberating the IIFC Draft Law and discussing the list of issues inventory (daftar inventarisasi masalah/DIM in Indonesian). Tax incentive policy at the financial centre has not yet been finalised, as discussions are still ongoing.
"So, those 50 years represent the [planned] period of tax imposition. Income tax will be imposed at 0% for a period of up to 50 years as long as the IIFC stands. That is one of the proposals," he said. (rig)
