Buy a House Free of VAT until the End of 2026, Minister of Industry: Encourage Demand for Domestic Industrial Products
JAKARTA - Minister of Industry (Menperin) Agus Gumiwang Kartasasmita supports and appreciates the government's policy in extending the Government-Covered Value Added Tax (PPN DTP) incentive for the purchase of freehold houses and apartments until December 31, 2026.
This policy is considered strategic in maintaining the momentum of property sector growth while providing a multiplier effect for the national manufacturing industry.
According to Agus, the policy set by the Minister of Finance (Menkeu) Purbaya Yudhi Sadewa shows the government's bias in encouraging people's purchasing power and strengthening economic sectors that have a wide connection with domestic industries.
"We welcome and appreciate the extension of the DTP VAT incentive for the purchase of freehold houses and apartments until the end of 2026. This policy is very important to maintain the sustainability of the property sector which has a close relationship with various subsectors of the manufacturing industry," said Agus quoted from a written statement, Thursday, January 8.
The policy is regulated in the Minister of Finance Regulation (PMK) Number 90 of 2025, which provides a DTP VAT incentive of 100 percent on the VAT owed from the selling price to Rp2 billion for houses with a maximum selling price of Rp5 billion.
The incentive applies to new homes that are ready to be inhabited and are handed over for the first time by developers in the period from January 1 to December 31, 2026.
Agus assessed that the incentive not only relieves the cost burden for people who want to have their first home, but will also stimulate the national property sector which has a high multiplier effect on the economy.
"This is in line with the strategy of strengthening the industry and domestic consumption," he said.
He said the property sector has a long supply chain and involves many sub-sectors of the industry, including the cement, ceramics, glass, basic metals, furniture, building materials, electrical appliances and household appliances industries, as well as other supporting sectors.
Therefore, every stimulus given to the property sector will have a direct impact on increasing demand for domestic industrial products.
"This extension of the DTP VAT will spur development activities and property transactions, which ultimately increase capacity utilization in various supporting industries. This also contributes to labor absorption and maintaining production stability in the manufacturing sector," said Agus.
Furthermore, the former Minister of Social Affairs assessed that the DTP VAT policy also provides certainty for industry players in formulating business and investment planning.
"With the continued fiscal stimulus until 2026, industry players have a wider space to increase production capacity, strengthen the domestic supply chain and increase the competitiveness of national products," he concluded.