JAKARTA - The Ministry of Finance (Kemenkeu) has confirmed that it will extend the tax holiday tax reduction incentive until 2026.
Director General of Economic and Fiscal Stability of the Ministry of Finance, Febrio Nathan Kacaribu, said that his party was preparing a new Minister of Finance Regulation that would regulate the extension of the tax-free incentive.
"So the PMK tax holiday is being processed to continue in 2026," said Febrio, quoted Wednesday, December 24.
Later, he continued, the policy not only regulates the extension, but will also be adjusted to the global minimum tax provisions.
He added that the implementation of the global minimum tax agreed upon in the framework of the Organization for Economic Cooperation and Development (OECD) made it impossible to provide a tax holiday as fully as before. In fact, he said, the tariff set in the global rules is 15 percent.
However, in the latest tax holiday concept, the exemption of tax rates for investors no longer reaches 100 percent, or the entire 22 percent corporate income tax rate is fully eliminated but in accordance with the GMT 15 percent agreement. The rest is given in the form of a substitute incentive that is still being formulated.
"We are still formulating it, but in the meantime, we are formulating it, the PMK for the tax holiday is being extended. Later, the 2026 will continue," concluded Febrio.
For information, the Ministry of Finance (Kemenkeu) noted that the estimated amount of taxes that the government deliberately did not collect in 2025 is estimated to reach Rp. 530 trillion.
Deputy Minister of Finance (Wamenkeu) Suahasil Nazara conveyed that the value was part of the tax incentive policy, which was aimed at maintaining the circulation of money in the national economy.
Suahasil explained that this policy includes various forms of facilities, such as the exemption of Value Added Tax (PPN), tax holiday, tax allowance, and import duty exemption.
"Our estimate for 2025 is between around Rp530 trillion that the government has not collected. We try to estimate this every year. This has been estimated since 2016," he said at the 1 Year of the Prabowo-Gibran Government event on Thursday, October 16.
"So if we give a tax holiday, the company will not pay taxes. If we give VAT exemption, it means that the transaction does not pay taxes. We try to continue to estimate and calculate, so sometimes we say the tax ratio is small, the tax ratio is small. Okay, the percentage is so much but this is not what we collect. How much? Rp530 trillion. It keeps increasing," he added.
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