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RI Govt to delay new tax schemes until purchasing power recovers

Jakarta (ANTARA) – Indonesia will refrain from introducing new taxes or raising existing rates until economic conditions and household purchasing power show clear improvement, Finance Minister Purbaya Yudhi Sadewa said on Wednesday.He said the recovery of purchasing power remains a key consideration in deciding whether additional tax policies are necessary, as the government seeks to safeguard economic momentum.“Before there is significant improvement in purchasing power and the economy, we will not introduce new taxes or increase existing tax rates,” Sadewa said.The minister noted that the government will rely on several indicators to assess economic recovery, including overall growth and consumer confidence surveys, rather than a single benchmark.Asked whether the government’s six percent growth target would serve as a threshold, he said the economy does not need to reach that exact level, but should approach it to signal stronger conditions.“My calculation is somewhere close to that (six percent). It doesn’t have to be exact, but near that level would indicate improvement. The key is ensuring new tax policies do not disrupt the economic trajectory,” he said.Indonesia’s tax revenue reached Rp394.8 trillion (about US$22.9 billion) as of March 31, 2026, marking a 20.7 percent increase from a year earlier, reflecting steady fiscal performance despite global uncertainty.At the same time, discussions have emerged over a potential expansion of the tax base, including the possibility of imposing value-added tax (VAT) on toll roads.Responding to the proposal, Sadewa said the government would conduct a thorough review before making any decision, emphasizing the need for careful analysis.“It should be analyzed first by the Directorate General of Economic and Fiscal Strategy. I’m not sure whether it has been done, but there seem to be many tax-related issues emerging suddenly,” he said.The proposal to impose VAT on toll roads is outlined in the Directorate General of Taxes’ 2025–2029 Strategic Plan as one option to broaden state revenue sources.