IIFC Patriot Bond and Incentives: Purbaya Awaits Repatriation
JAKARTA, DDTCNews - Minister of Finance, Purbaya Yudhi Sadewa, continues to encourage the repatriation and domestic investment of funds held overseas by Indonesian citizens.
At present, he added, the government already has a range of incentives to attract investment, including special securities issued by BPI Danantara, namely the Patriot Bond and Merah Putih Bond. The government has also established the Indonesian International Financial Centre (IIFC) with a variety of incentives.
"If the funds are not repatriated after being offered the facilities. There's the Patriot Bond, there's this [IIFC]. If they are not repatriated, I will audit the tax on every fund invested here,” said Purbaya, as quoted on Friday (24/7/2026).
As is known, under Law 4/2023 as amended by Law 4/2026, the state guarantees and protects the purchase of special securities, such as the Patriot Bond and Merah Putih Bond, from general criminal prosecution, special criminal prosecution including tax criminal prosecution and civil lawsuits.
In addition, data and information arising from the purchase of special securities may not be used as a tax base, nor may they be used as legal evidence in litigation before a court. See also 'PPatriot Bond Differs from Tax Amnesty: Fund Origins Not Questioned'.
Regarding the IIFC, income tax facilities of 0% for up to 50 years will be on offer. The regulation relating to incentives will be set out in the implementing regulations under the IIFC Law, which has just been agreed upon by the government and the House of Representatives. See 'IIFC Law Ratified: Investors Eligible for 50-Year 0% Corporate Tax'.
Purbaya stated that until the end of this year, he would tend to wait and observe the movements of fund owners abroad. After that, from 2027, he would proceed with tax audits. See 'Rich Indonesian Citizens to Buy Patriot Bond in 6 Months'.
"Early [2027] is when I will get to work. So once funds flow in, I will cooperate with the IIndonesian Financial Transaction Reports and Analysis Center (Pusat Pelaporan dan Analisis Transaksi Keuangan/PPATK in Indonesian) and we will audit the tax. Until the end of [2026] I will stay quiet,” said Purbaya.
In his view, the potential for repatriation of funds held overseas by Indonesian citizens is enormous. For this reason, the IIFC should also be capable of attracting large volumes of investment. He noted that many Indonesian citizens have long parked their assets in various locations, particularly in tax haven countries or territories.
"I don't know what the figure looks like, but it should be substantial. Some of that money is, of course, from the shadow economy, which means it can't be counted. However, it must be very substantial indeed. Perhaps they won't automatically repatriate their assets straight away, given that they have been keeping their assets overseas all this time," said Purbaya.
He also expressed hope that the various incentives offered through the IIFC would attract significant foreign investment into the country. “We also hope that those parties abroad [foreign investors] would be interested in investing here because it is attractive. My expectation is zero to positive," he added. (kaw)
