Indonesian Government Introduces Tax Incentives for Fresh Graduate Interns

Supporting New Graduates in the Workforce

The Indonesian government has announced a significant policy initiative to support fresh graduates entering the workforce through an internship program. Starting in 2026, interns will benefit from a comprehensive tax incentive scheme.

Key Features of the Tax Incentive

1. Full Salary without Tax Deductions: Through the Income Tax (PPh) Article 21 borne by the government (DTP) scheme, interns will receive their full stipend without any income tax deductions.
2. Enhanced Employability: The program aims to enhance the employability of new graduates by providing them with practical work experience.
3. Government Support: The government will bear the income tax burden, ensuring that interns receive their full remuneration.

Implications for Fresh Graduates and Employers

This policy is expected to have a positive impact on both fresh graduates and employers. Graduates will benefit from gaining valuable work experience without the immediate financial burden of income tax. Employers, on the other hand, will have access to fresh talent while contributing to the development of the future workforce.

Conclusion

The introduction of tax incentives for fresh graduate interns marks a proactive step by the Indonesian government to address the challenges faced by new entrants to the job market. By providing financial support and practical experience, the government aims to create a more conducive environment for young professionals to launch their careers.