IIFC Law Covers 35 Sectors Eligible for Tax Incentives

JAKARTA, DDTCNews - The Government, through Article 5 paragraph (1) of Law 6/2026 on the Indonesian International Financial Centre (IIFC), divides business activities at the IIFC into 3 types: financial sector activities, financial sector supporting activities and other sector activities.

Across these three types of business activities, there are 35 business sectors regulated under the IIFC Law. Entrepreneurs carrying out activities at the IIFC to attract investment will be granted tax facilities.

"In the context of attracting investments: entrepreneurs conducting business activities referred to in Article 5 paragraph (1) shall be granted tax facilities," reads Article 47 of Law 6/2026, as cited on Monday (2/11/2026).

In detail, Article 5 paragraph (1) of Law 6/2026 divides business activities at the IIFC into 3 types. First, business activities in the financial sector, encompassing 18 business sectors, namely:

• banking;
• insurance;
• sharia finance;
• capital markets, derivatives finance and carbon exchanges;
• pension funds;
• financing;
• venture capital;
• technological innovation in the financial sector;
• guarantees;
• international commodity trading;
• bullion;
• trusts;
• special purpose vehicles;
• financial holding companies;
• the money market, the foreign currency market and their derivatives transactions;
• family offices;
• investment management; and
• other business activities in the financial sector, including financial market infrastructure.

Second, supporting business activities in the financial sector, encompassing 10 types of professional services, namely:

• public accountants;
• appraisers;
• notaries;
• legal consultants;
• financial consultants;
• investment managers;
• tax consultants;
• actuaries;
• financial services sharia experts; and
• other supporting business activities in the financial sector;

Third, other sector business activities, encompassing 7 sectors, namely:

• transportation, including ship registration and aircraft registration;
• accommodation, including hotels;
• healthcare;
• solid waste and waste management;
• tourism;
• food and beverages; and
• other business activities as determined by the IIFC Council.

In carrying out such business activities, entrepreneurs may establish a business entity, a business entity constituting a legal entity, a special purpose vehicle and/or a trust and/or other legal entities as regulated under IIFC Council regulations.

Further provisions on business activities at the IIFC shall be regulated by IIFC Council regulations. The IIFC Council is the organ vested with specific authority to manage the IIFC.

It should be noted that Law 6/2026 also regulates tax facilities for entrepreneurs conducting activities at the IIFC to attract investment. However, the duration of incentive consumption varies depending on the type of business activity.

Article 48 paragraph (2) of the IIFC Law provides that core IIFC sector activities, namely financial sector business activities and investment activities conducted by non-tax residents, shall be granted income tax facilities for a period of 50 years.

Meanwhile, financial sector supporting business activities and other sector activities as well as the IIFC Management Institution (Lembaga Pengelola/LP in Indonesian) and the IIFC Financial Services Supervisory Institution (Lembaga Pengawas Jasa Keuangan/LPJK in Indonesian) shall be granted income tax facilities for a shorter period than the two core IIFC sectors.

These income tax facilities apply only to income derived from the IIFC and to entrepreneurs, professionals and non-tax residents who fulfil certain qualifications.

One of the income tax facilities granted takes the form of a 100% corporate income tax reduction. This incentive is granted to entrepreneurs conducting activities at the IIFC in the financial sector; financial sector supporting activities and other sectors as referred to in Article 5 paragraph (1).

"The granting of the corporate income tax reduction facility ... shall continue to take into account agreements or international agreements related to taxation," reads Article 51 paragraph (3) of Law 6/2026. (dik)