Indonesia Aims to Boost Economy with Major Tax Reforms by 2026
Indonesia is pushing for significant tax reforms to boost its economy. The government aims to increase tax revenue to IDR3,147.7 trillion ($195 billion) by 2026, a 13.6% rise from the 2025 outlook. To achieve this, it targets to lift its tax-to-GDP ratio to 1.28 percentage points by 2030, with plans to hire foreign IT experts to ensure a fully functional Coretax system.
The Coretax system, launched in early 2025, has faced repeated malfunctions, hindering tax collections. Indonesian Finance Minister Purbaya Yudhi Sadewa has pledged to fix these issues within a month. The government may establish a State Revenue Agency (BPN) if tax and customs duty targets are not met. The Asian Development Bank (ADB) has allocated part of a $500 million loan to improve Coretax and support fiscal reforms.
As of August 31, 2025, Indonesia's tax revenues fell by 3.6% to IDR1,330.4 trillion ($86.2 billion). The government is considering hiring foreign IT experts to ensure the system runs smoothly and to resolve long-term technical disruptions.
Indonesia's tax reforms and Coretax system improvements are crucial for meeting its revenue targets. The government's commitment to fixing Coretax within a month and considering external IT expertise demonstrates its dedication to fiscal reform. The potential establishment of a State Revenue Agency underscores the government's resolve to meet its fiscal goals.
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