#TAX
World Bank highlights Indonesia's low tax revenue
The World Bank has highlighted Indonesia's low tax revenue performance − apparently the lowest in the world − in a report entitled "Estimating Value Added Tax (PPN) and Corporate Income Tax (PPh) Gaps in Indonesia" released on March 2, 2025.
Govt proposes higher royalties for coal, mineral commodities to boost State revenue
The Ministry of Energy and Mineral Resources (ESDM) has proposed an increase in royalty rates or Non-Tax State Revenue (PNBP) in the mineral and coal (minerba) sector.
Prabowo pushes for BPN to boost tax ratio, experts concerned on feasibility
President Prabowo Subianto has prioritized the establishment of the State Revenue Agency (BPN) in the 2025-2029 National Medium-Term Development Plan (RPJMN), which is regulated in Presidential Regulation (Perpres) No. 12/2025 which has been in effect since February 10, 2025.
Indonesia told to improve business environment to achieve high-income status
Indonesia must enhance its business environment to accelerate economic growth and escape the middle-income trap, according to Norman Loaiza, Director of the Global Indicators Group at the World Bank Group. Speaking at the launch of the Business Ready (Be Ready) Report, Loaiza highlighted key areas where Indonesia needs improvement to attract investments and foster a dynamic private sector.
Budget savings will not affect infrastructure projects: Yuliot
Deputy Minister of Energy and Mineral Resources (ESDM), Yuliot Tanjung, has affirmed that the government's budget savings initiative will not impact infrastructure projects as budget reduction only applies to ministerial and institutional expenditures, not infrastructure spending.
2024 State Budget deficit reaches Rp507.8 trillion, 2.29 percent of GDP: Sri Mulyani
Minister of Finance, Sri Mulyani Indrawati, reveals that the 2024 State Budget (APBN) recorded a deficit of Rp507.8 trillion (US$31.3 billion), equivalent to 2.29 percent of Gross Domestic Product (GDP), but still better than the projected deficit for the first semester of 2024 at2.7 percent of GDP.
Government postpones 12-percent VAT increase: Luhut Binsar Pandjaitan
Chairman of the National Economic Council, Luhut Binsar Pandjaitan, says the government has decided to postpone the planned increase of the Value Added Tax (VAT) rate to 12 percent, which was originally scheduled to take effect in January 2025.
DGT efforts to increase Indonesia's tax ratio up to 15%
The Directorate General of Taxes (DGT) intends to raise the present tax ratio to 15%, aligns with the global average. Indonesia's current tax ratio of 10.4% is still below the global average of 13.5%, as per the DGT. Indonesia is also trailing behind other nations in the ASEAN region; for instance, Thailand's tax ratio is at 14.5%, the Philippines at 14%, and Singapore at 12.9%.