Indonesia's Tax Revenue Faces Headwinds in 2025

Economic Slowdown Impacts Tax Collection

Indonesia's Finance Minister, Purbaya Yudhi Sadewa, has acknowledged that achieving the 2025 tax revenue target will be challenging due to the prevailing economic slowdown. As of Q3 2025, tax revenue stood at Rp 1,295.3 trillion, representing a 4.4% year-over-year contraction ¹

Minister's Statement and Tax Official Guidance

Purbaya emphasized that the shortfall in tax revenue is not due to the performance of tax officials but rather the result of economic pressures. He urged tax officials to remain optimistic and focused on meeting the target, stating, "Teman-teman pajak, jangan putus asa, target pasti dicapai" (Tax officials, don't be discouraged, the target will be achieved) ²

Implications for Indonesia's Economy

The economic slowdown has directly impacted tax revenue, highlighting the challenges faced by the government in achieving its fiscal targets. The situation underscores the need for careful fiscal management and potentially revising targets in line with current economic conditions.