Employee Tax Exemption & PTKP Rise Included in 2027 Incentive Package
JAKARTA, DDTCNews - The government is preparing 9 types of incentives, both tax and non-tax, to drive economic growth in 2027. This topic is among the reviews covered by national media today, Monday (26/10/2026).
Coordinating Minister for Economic Affairs, Airlangga Hartarto, stated that the economic stimuli being prepared for next year include, among others, the continuation of the national internship and vocational programme, the expansion of the government-borne (ditanggung pemerintah/DTP in Indonesian) Article 21 Income Tax incentive and an increase in the personal tax relief (penghasilan tidak kena pajak/PTKP in Indonesian) threshold.
"The President's directive for next year's programme is expected to commence in January, namely the continuation of the national internship, followed by the national vocational programme, government-borne income tax for workers earning a maximum of IDR10 million for all sectors and an evaluation of the increase to the personal tax relief threshold," he said.
In detail, Airlangga outlined the 9 fiscal and non-fiscal incentives being prepared by the government. First, a national internship programme for 150,000 participants, inclusive of pocket money, employment injury security (jaminan kecelakaan kerja/JKK in Indonesian) and death security (jaminan kematian/JKM in Indonesian), certificates, and government-borne Article 21 Income Tax.
Second, a national vocational programme with a quota of 300,000 participants. To implement both programmes, the government has set aside a budget of IDR5.68 trillion.
Third, government-borne Article 21 Income Tax for all business sectors, targeting workers whose income does not exceed IDR10 million per month. It is planned that the minister of finance regulation governing the technical provisions of this policy will be signed before 1 January 2027.
Fourth, an increase in the personal tax relief threshold. Airlangga stated that the personal tax relief will be raised taking into account inflation and the regency/municipal minimum wage (upah minimum kabupaten/kota/UMK in Indonesian). However, the precise new personal tax relief figure has yet to be determined.
Fifth, government-borne VAT on the transfer of residential properties. The government-borne VAT incentive applies to the fraction of the selling price of a property up to IDR2 billion. The MoF Reg. concerning the granting of the government-borne VAT incentive will also be finalised before 1 January 2027.
Sixth, a relaxation of JKK and JKM contributions in the form of a 50% discount on the total JKK and JKM contributions otherwise payable by non-wage recipient (bukan penerima upah/BPU in Indonesian) participants. It is planned that Government Regulation (Gov. Reg.) 50/2025 will be revised and issued before January 2027.
Seventh, additional unemployment security (jaminan kehilangan pekerjaan/JKP in Indonesian) benefits. Eighth, subsidised mortgages for middle-income households (masyarakat berpenghasilan tanggung/MBT in Indonesian).
Ninth, the establishment of a new standard for VAT exemption on gold and the opening of scope to provide VAT incentives on silver, to strengthen the domestic jewellery industry.
Airlangga explained that the government will revise Gov. Reg. 49/2022 with a view to granting VAT exemption on gold with a purity of 99.9%. Furthermore, the revision of that government regulation also opens scope for granting VAT incentives on silver.
"For the jewellery sector, there is a change from the 99.99% standard. In practice, the industry standard should be 99.9%," said Airlangga.
Beyond the above topic, there is also a review of the Directorate General of Taxes' (DGT) clarification that KEP-239/PJ/2026 is not a tax amnesty. In addition, there is coverage of the Audit Board's (Badan Pemeriksa Keuangan/BPK in Indonesian) findings on tax holidays, the Ministry of Home Affairs' guidance on local taxes, the cancellation of billing codes and other matters.
The following is a full review of the tax articles.
PTKP Increase Has Received In-Principle Approval from the President
Various tax reliefs, such as an increase in personal tax relief and the expansion of the scope of government-borne Article 21 Income Tax, have received in-principle approval from President Prabowo Subianto. The said in-principle approval is set out in the Letter of the Minister Secretary of State No. B-40/M/SDK/KI.00/10/2026 dated 20 October 2026.
Coordinating Minister for Economic Affairs, Airlangga Hartarto, stated that the personal tax relief threshold will be raised taking into account inflation and the regency/municipal minimum wage (upah minimum kabupaten/kota/UMK in Indonesian). Regrettably, the precise new personal tax relief figure has yet to be determined.
"The review of the increase in personal tax relief, currently at IDR54 million, will naturally take into account inflation and the minimum wage," he said. (DDTCNews)
MoHA Reminds Local Governments Not to Raise Taxes to Pursue PAD
The Ministry of Home Affairs (MoHA or Kementerian Dalam Negeri/Kemendagri in Indonesian) has again reminded local governments not to adopt local revenue policies that burden the public.
MoHA Secretary General, Tomsi Tohir, urged local governments to maintain ongoing communication with MoHA to prevent the emergence of policies that place undue burdens on the public.
"I ask that cooperation be established between central and local governments. Properly record the names and telephone numbers, communicate effectively, create WhatsApp groups and so forth," he said. (DDTCNews)
BPK Records 3 Nickel Tax Holiday Applications Not Followed Up by BKPM
The Audit Board (Badan Pemeriksa Keuangan/BPK in Indonesian), through its audit, found that 3 applications for tax holiday facilities from ferronickel and nickel pig iron (NPI) entrepreneurs had not been followed up by the Ministry of Investment and Downstream Industries/Indonesian Investment Coordinating Board (Badan Koordinasi Penanaman Modal/BKPM in Indonesian).
During the audit of the log records in the OSS system, it was found that 3 tax holiday applications from entrepreneurs had not had their status determined up to the first half of 2025.
"In respect of the applications whose status had not been determined, the Ministry of Investment and Downstream Industries/BKPM did not issue a rejection and/or explanation to the entrepreneurs," the BPK disclosed in its audit report (laporan hasil pemeriksaan/LHP in Indonesian) with specific objectives (dengan tujuan tertentu/DTT in Indonesian) covering the period from 2021 to the first half of 2025. (DDTCNews)
DGT Clarifies That KEP-239 Is Not a Tax Amnesty
The DGT grants facilities for the reduction or nullification of tax administrative penalties through the Administrative Penalty Reduction or Nullification Programme (Program Pengurangan atau Penghapusan Sanksi Administrasi/PSA in Indonesian). This programme is governed by the Director General of Taxes Decree No. KEP-239/PJ/2026.
Whilst providing relief to taxpayers, the DGT has clarified that the PSA programme is not a tax amnesty. Relief is granted solely in respect of specific administrative penalties, provided the taxpayer fulfils the applicable requirements.
"KEP-239 is different from a tax pardon or tax amnesty. This decree does not pardon tax that is properly due and does not waive the principal tax," as cited from the Administrative Penalty Reduction or Nullification Programme Guide Book. (Kontan)
DGT: Taxpayers Creating Incorrect Billing Code May Cancel It via Coretax
The DGT has confirmed that taxpayers that create an incorrect billing code may cancel it online through the coretax system. The cancellation applies to self-remitted billing codes, billing codes for tax collection and billing codes from tax returns with an underpayment status.
The DGT explained that a billing code may be cancelled provided the following conditions are fulfilled: it has not yet been paid and the billing code has not expired, i.e., it remains within its 14-day validity period from the date of issuance.
"Cancellation may be performed if the billing code contains an incorrect taxable period, amount or tax type," the DGT explained via its social media. (DDTCNews)
SEZs Relied Upon to Attract Data Centre and Semiconductor Investment
The government is promoting the development of special economic zones (SEZs), digital infrastructure and the creative economy to attract investment whilst simultaneously driving economic growth.
Coordinating Minister for Economic Affairs, Airlangga Hartarto, stated that Indonesia needs to build an ecosystem that supports investment in the field of technology, such as through the strengthening of industry and the construction of supporting infrastructure. These efforts are also being pursued through cooperation with India.
"I hope that through this collaboration, the creative sector can grow into double digits," he said. (DDTCNews)