Bank Indonesia Policy Mix
In the Medium-term, Tax Revenue is Expected to Increase along with the
Tax Reforms
Tax Regulation Harmonization Bill (HPP) strengthens tax reform
Policy Changes in the HPP Bill
1. KUP (General Provisions and Procedures on Tax)
a) NPWP (Tax Number Identification) using NIK
(National ID Number)
b) Appointment of third parties as withholding,
collecting, depositing and/or reporting tax
(including e-commerce)
2. PPh (Income Tax)
a) PPh OP (Personal Income Tax) bracket
adjustment
b) Corporate Income Tax in 2022 remains at 22%
c) PPh rate at 0.5% for MSME-OP (threshold IDR
500 million)
d) Natura (Employee non-cash benefits) becomes tax
object
3. PPN (Value-Added Tax)
a) VAT rate increased from 10% to 11% (1 April
2022) and maximum to 12% in 2025
b) Non BKP (Non-Taxable goods) and non JKP (Non-
Taxable services) are moved to BKP/JKP
category. Specifically for Health Services, certain
medical health services are included in the JKN
program system
4. Taxpayer Voluntary Disclosure Program
5. Carbon Tax
Note:
IDR Tn
Expected Tax Revenue and Tax ratio 2021-2025
3,800
3,300
12.00
11.00
10.12
9.53
9.22
9.29
10.00
8.58
2,800
8.44
8.46
8.51
9.00
8.56
2,323.1 8.00
2,300
2,013.2 1,969.8
1,811.1 1,798.2
7.00
1,800
1,649.3 1,649.0
1,413.7
1,413.7
1,510.0
6.00
1,300
5.00
4.00
2025
800
2021
Baseline
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■
◉
2022
2023
2024
Reform + HPP
Tax ratio baseline
Tax ratio Reform + HPP
The 2021 tax outlook is estimated at IDR 1,413.7 Trillion.
Ongoing tax reforms will increase tax revenue in 2021.
Tax revenue on 2022 state budget is projected to IDR 1,510.0
T.(tax ratio of 8.44% of GDP); without the HPP Bill.
Without the tax reform and HPP Bill, the tax ratio for 2021-2025 is
expected to stagnate in the range of 8.4-8.6% of GDP.
With the tax reform and implementation of the HPP Bill, the tax
ratio in 2022 is estimated to reach 9.22% of GDP and 10.12% of
GDP in 2025.
1. The ratio of tax, excise and custom revenues (exclude non-tax revenue) to gross domestic product.
Source: Ministry of Finance
% GDPView entire presentation