Indonesia rules out extension of corporate tax holiday
A senior fiscal policy analyst said the incentive was incompatible with the global minimum tax, though existing recipients could retain their benefits until expiry.
Indonesia’s Finance Ministry will not prolong the corporate income tax holiday covered by Finance Minister Regulation No. 69 of 2024. The regulation set 31 December 2025 as the final date for applications, excluding businesses and investors that applied after that deadline.
At The 16th TIF Tax Outlook Seminar on 4 November 2026, Melani Dewi Astuti, senior fiscal policy analyst at the Directorate General of Economic and Fiscal Strategy, said the holiday was incompatible with global minimum tax rules. She said there were no current plans to extend it.
Indonesia began implementing the global minimum tax in 2025. The policy imposes an effective tax rate of 15 per cent on entities belonging to multinational corporate groups with annual gross turnover of at least EUR750 million.
Melani said businesses already granted a tax holiday could use it for the remainder of their entitlement. However, an effective rate below 15 per cent would still trigger a requirement to pay top-up tax.
The global minimum tax framework includes the Substance-based Tax Incentive (SBTI) Safe Harbour, launched on 1 January 2026. Other incentives are considered not to affect effective tax rates, including accelerated depreciation on tangible assets, tax allowances, investment allowances, superdeductions and production-based tax incentives.
