Indonesia Strengthens Tax Compliance with New Inspection Powers

Enhanced Surveillance Mechanism

The Indonesian government has introduced new regulations through PMK No. 111/2025, empowering the Directorate General of Taxes (DJP) to conduct sudden inspections and examinations. This significant development in tax administration became effective on January 1, 2026.

Scope of New Powers

The new regulation allows the DJP to perform comprehensive oversight including: registered taxpayer monitoring, unregistered taxpayer identification, and regional tax compliance surveillance. These measures are designed to enhance overall tax compliance and ensure adherence to tax regulations.

Implementation and Impact

The enhanced authority granted to the DJP demonstrates the government's commitment to improving tax collection efficiency. By enabling sudden inspections, the tax authority can more effectively deter and detect non-compliance, potentially leading to increased revenue collection and a more equitable tax environment.