Indonesia Sticks to Tax Plan: No New Taxes in 2026, Minister Confirms
Jakarta, Singapore – In a move that will likely reassure investors and businesses, Indonesia's Finance Minister Sri Mulyani Indrawati has confirmed that the government has no plans to introduce new taxes in 2026. This announcement comes amidst ongoing efforts to meet ambitious tax revenue targets and underscores the government’s commitment to fiscal stability.
Speaking on Friday, Minister Indrawati explained that the government intends to bolster its tax revenue through internal reforms and improved efficiency within the existing tax system, rather than resorting to introducing additional taxes. This strategy aims to minimise disruption to the business environment and maintain a competitive edge for Indonesian companies.
Focus on Optimising Existing Tax System
The Indonesian government has been actively pursuing various reforms to enhance tax collection and compliance. These initiatives include streamlining tax administration processes, leveraging technology to improve data analysis and identify potential tax evasion, and strengthening enforcement measures. The Minister highlighted the importance of these internal improvements to achieve the desired revenue growth without burdening taxpayers with new obligations.
“We believe that we can achieve our revenue targets by optimising the existing tax system and improving compliance,” Minister Indrawati stated. “Introducing new taxes would be a last resort, and we are confident that we can rely on internal reforms to meet our fiscal goals.”
Why This Matters for Singaporean Businesses
This news is particularly relevant for Singaporean businesses with operations or investments in Indonesia. The assurance of no new taxes in 2026 provides greater certainty and predictability for long-term planning and investment decisions. It reinforces Indonesia’s commitment to creating a stable and attractive investment climate.
Singapore and Indonesia share a strong economic relationship, with significant trade and investment flows between the two countries. A stable and predictable regulatory environment in Indonesia is crucial for sustaining and expanding this partnership.
Looking Ahead: Continued Reform Efforts
While the government has ruled out new taxes for 2026, the focus remains on continuous improvement and adaptation within the tax landscape. Analysts expect further refinements to tax regulations and procedures to ensure fairness, transparency, and efficiency. The government’s commitment to digital transformation and automation within the tax administration is also expected to play a key role in achieving its revenue targets.
The decision not to introduce new taxes reflects a pragmatic approach to fiscal policy, prioritizing stability and business confidence while pursuing sustainable revenue growth through internal reforms. This strategy is likely to resonate positively with both domestic and international stakeholders, further solidifying Indonesia’s position as a key player in the Southeast Asian economy.
