Executive Summary

Key insights and market outlook

The Indonesian government is preparing to replace the tax holiday incentive that will expire in December 2025 with a new policy ¹

. As of October 2025, 403 companies have benefited from tax holiday facilities, with investments totaling Rp 496.2 trillion ². The new regulation is being drafted by the Directorate General of Legislation (DJPP) in collaboration with the Ministry of Finance.

Full Analysis

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Deep Dive Analysis

Indonesia to Introduce New Tax Incentives as Current Tax Holiday Ends

Government Prepares Replacement Policy

The Indonesian government is working on a new tax incentive policy to replace the current tax holiday facility, which is set to expire in December 2025 ¹

. The Directorate General of Legislation (DJPP) has held meetings to discuss the draft regulation regarding the Second Amendment to Minister of Finance Regulation No. 130/PMK.010/2020 concerning Corporate Income Tax Reduction Facilities for pioneer industries.

Current Tax Holiday Statistics

As of October 2025, a total of 403 companies have benefited from various tax holiday schemes, including pioneer industries, Special Economic Zones (SEZ), and investments in the new capital city, Nusantara (IKN) ²

. The total investment from these companies amounts to Rp 496.2 trillion. Specifically, 290 companies received the general tax holiday, with 102 already operational and realizing Rp 480 trillion in investments. Another 106 companies benefited from the SEZ tax holiday scheme, with 23 operational companies investing Rp 16.2 trillion.

New Policy Development

The upcoming regulation aims to adjust the terms and application mechanism for corporate income tax reduction facilities for pioneer industries. While specific details of the new policy are still being finalized, it represents the government's effort to maintain investment attractiveness while optimizing fiscal benefits.

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