Prevent Lay-offs: House Urges DGT to Grant Tax Payment Relief
JAKARTA, DDTCNews - Zainul Munasichin, a member of the House of Representatives (Dewan Perwakilan Rakyat/DPR in Indonesian) Commission IX, has called on the government to facilitate companies to obtain tax payment relief or dispensation as one of the measures to prevent lay-offs (pemutusan hubungan kerja/PHK in Indonesian).
According to Zainul, the concession in the form of tax payment relief can help companies remain viable amidst economic pressures. Such a policy could also ease companies' cash flow, thereby reducing the likelihood of lay-offs.
"If lay-offs can be prevented, then let us do so through incentives. For instance, if a company has tax arrears, we may grant relief or dispensation. It turns out that this helps the company survive for longer," he said, as quoted on Wednesday (22/7/2026).
The provisions on the instalment or deferral of tax payments are, in fact, stipulated under Article 113 of Minister of Finance Regulation (MoF Reg.) 81/2024, as amended by MoF Reg. 1/2026. Taxpayers may submit an application to the director general of taxes to pay in instalments or defer payment of tax in respect of:
- the underpayment of tax payable based on the annual income tax return as referred to in Article 95 paragraph (1); and
- outstanding tax as referred to in Article 97 paragraph (3) and the settlement obligation under Article 98 paragraph (1),
where the taxpayer is experiencing insolvency or circumstances beyond their control such that the taxpayer is unable to fulfil its tax obligations on time.
An application for instalment or deferral of payment of outstanding tax or a settlement obligation as referred to in Article 113 letter b must be submitted using an application letter for instalment payment of tax liability or an application letter for deferral of payment of tax liability.
Beyond tax matters, Zainul also proposed that the government provide relaxation in the field of customs, particularly for companies that still rely on imported raw materials.
In his view, a reduction in import tariffs could help companies maintain liquidity for business operations to continue and workers to be retained.
"If a company's raw materials must be imported, the import tariffs are quite high. If the government were to grant import tariff dispensation, the company's lifespan would be considerably extended," he said.
The government had previously established a Lay-off Mitigation Task Force to address the rise in lay-offs. According to Zainul, the task force should not merely deal with the consequences of lay-offs but should also seek out the root causes that lead companies to pursue efficiency measures that ultimately result in lay-offs. (dik)
