By The Straits Times | Created at 2026-10-01 04:02:03 | Updated at 2026-10-01 05:08:06
1 hour ago
JAKARTA – Indonesia plans to increase the tax-free threshold for income, a senior minister said, with the first adjustment in a decade set to increase disposable income as the government looks to stimulate economic activity.
Currently, no income tax is payable on annual income of 54 million rupiah (S$3,800) or less. The threshold is intended to protect low-income earners, and was last adjusted in 2016.
Airlangga Hartarto, Coordinating Minister for Economic Affairs, said late on Sept 30 the government was calculating a “fix” to the threshold for 2027, but offered no other details.
The comment came as Airlangga announced other measures aimed at boosting spending power, including expanding an income tax exemption to all people earning less than 10 million rupiah per month, which currently only applies to workers in some labour-intensive and tourism industries.
The government will allocate around 31 trillion rupiah for cash and food handouts to low-income people in the final quarter of 2026, Airlangga said.
A tax break on certain property sales will be extended to 2027, he said.
The new stimulus steps are in addition to a package announced earlier in 2026. REUTERS
