JAKARTA — Indonesia’s government is finalizing a comprehensive overhaul of its tax-free income threshold (Penghasilan Tidak Kena Pajak or PTKP) alongside a broader economic stimulus package designed to protect middle-class purchasing power and cushion vulnerable workers.
Speaking at a press conference on third-quarter economic growth in Jakarta on Thursday, Coordinating Minister for Economic Affairs Airlangga Hartarto indicated that the revised PTKP limits are undergoing deep internal review and are targeted for implementation after January 2027.
”It will be implemented next year. It won’t take effect in January, so likely after January,” Airlangga stated.
The baseline adjustment forms part of a multi-pronged fiscal policy aimed at supporting domestic consumption while bolstering social safety nets amid ongoing global economic shifts.
Key Fiscal & Social Safeguards
| Policy Measure | Core Mechanism | Target Audience |
|---|---|---|
| PTKP Adjustment | Baseline threshold revision combined with PPh 21 tax coverage | Low- to middle-income earners |
| PPh 21 DTP Incentive | Government-borne income tax for earnings up to IDR 10M/year | Formal employment sector |
| Property Tax Break | 100% government-borne VAT (PPN DTP) for homes up to IDR 2B (capped at IDR 5B) | Homebuyers & property sector |
| Subsidized Mortgages | Fixed 6% interest rate housing loans | Middle-tier income group |
| Jewelry Tax Standard | VAT exemption on gold jewelry adjusted to 99.9% purity threshold | Physical investment & retail market |
| Informal Worker Net | 50% premium subsidy for job loss (JKP) and death benefits | Non-wage earners (BPU) |
Sumber: Liputan6.com
Protecting the Middle Class and Informal Sector
Beyond personal income tax relief, the government is expanding targeted stimulus to property and informal employment sectors to maintain economic momentum.
To revive real estate activity, the state will cover 100 percent of value-added tax (PPN DTP) on residential purchases up to IDR 2 billion (with eligible ceiling prices up to IDR 5 billion). The measure is backed by subsidized mortgages featuring a fixed 6 percent interest rate tailored for middle-income buyers.
For physical investments, the government introduced a refined purity benchmark for gold jewelry, extending VAT exemptions to items with a 99.9 percent purity rating—adjusting the previous 99.99 percent standard to better align with domestic retail markets.
Recognizing the exposure of non-wage workers (BPU) to economic volatility, the stimulus framework also incorporates a 50 percent contribution subsidy for Job Loss Guarantee (JKP) and Death Guarantee programs, expanding the reach of formal social protection across the informal economy.
