WTS Indonesia is a professional service firm focusing on the provision of Indonesian tax services. Equipped with decades of experience in dealing with complex Indonesian tax ecosystem, Tomy Harsono founded WTS Indonesia in 2019 where the firm started aiming to excel in the market from that point on
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Revamped Final Tax Regime for Micro, Small, and Medium Enterprises (MSME)
Revamped Final Tax Regime for Micro, Small, and Medium Enterprises (MSME)
Government Regulation No. 20 of 2026
The Government of Indonesia has enacted Government Regulation (GR) No. 20 of 2026, amending GR No. 55 of 2022 on the implementation of the Income Tax Law. While the regulation retains the existing 0.5% final income tax rate for micro, small, and medium enterprises (MSMEs) and maintains the annual gross turnover threshold of IDR 4.8 billion, it introduces several important measures aimed at strengthening tax compliance, preventing the misuse of preferential tax regimes, and aligning Indonesia’s domestic tax framework with international anti-corruption standards.
One of the most significant developments introduced under GR No. 20 of 2026 is the addition of Article 20A, which expressly stipulates that expenses in the form of bribes, gratuities, or any other payments made in connection with corruption and bribery offences — including those made to foreign public officials — are non-deductible for income tax purposes. By codifying the non-deductibility of such expenditures, the Government reaffirms its commitment to combating corruption and supporting internationally accepted principles that prohibit taxpayers from obtaining tax benefits from illicit payments. In light of this change, taxpayers should promptly review their internal policies and compliance procedures to ensure that such expenses are not treated as deductible costs in their tax filings.
In addition to the anti-corruption provisions, GR No. 20 of 2026 further expands the categories of independent professional services excluded from the 0.5% final income tax regime. Beyond traditional professions such as lawyers, doctors, consultants, artists, and athletes, the exclusion list now encompasses various occupations in the digital economy, including influencers, bloggers, vloggers, social media personalities, content creators, and similar professions. As a result, individuals engaged in these activities will generally be subject to the ordinary income tax regime rather than the preferential final income tax scheme, and affected taxpayers should reassess their current tax position accordingly.
The amendment also introduces clearer and more stringent rules for determining whether taxpayers meet the IDR 4.8 billion gross turnover threshold. Under the revised framework, gross turnover must be assessed on an aggregated basis by taking into account the combined turnover of married taxpayers as well as any sole-shareholder companies established or controlled by either spouse. These enhanced aggregation requirements are specifically designed to prevent the artificial fragmentation of business activities and to ensure that the preferential tax regime is available only to taxpayers that genuinely and substantively satisfy the prescribed threshold.
Another significant change under GR No. 20 of 2026 relates to the duration of the final tax facility. Under the previous framework established by GR No. 55 of 2022, the utilization period of the 0.5% final income tax regime was limited to seven years for individual taxpayers, four years for cooperatives, partnerships, and firms, and three years for limited liability companies. The new regulation removes Article 59 and introduces transitional provisions for existing taxpayers, reflecting a deliberate shift from a purely time-based approach towards a more substance-oriented framework. This change is intended to ensure that the MSME tax facility is utilized only by taxpayers for whom it was originally designed and to reduce opportunities for tax avoidance through the exploitation of time-limited preferential treatments.
Taken together, while GR No. 20 of 2026 preserves the existing 0.5% final income tax rate and the IDR 4.8 billion gross turnover threshold, it nevertheless marks a significant evolution in the design and administration of Indonesia’s MSME tax regime. Through the introduction of explicit anti-corruption provisions, the expansion of excluded professions, the enhancement of turnover aggregation requirements, and the move towards a substance-based framework, the Government seeks to strengthen tax integrity and reinforce the policy objectives underlying the preferential regime. Against this backdrop, taxpayers are strongly advised to reassess their business structures, turnover calculations, and eligibility positions to ensure continued compliance with the revised framework.
Should you wish to discuss the implications of GR No. 20 of 2026 for your business, please do not hesitate to contact your WTS Indonesia consultant.
Your Contacts
Tomy Harsono
Partner (Consulthink)
T +62 811 9196 939
Tomy.harsono@wtsindonesia.com
Andy Irawan
Manager
T +62 895 0612 2020
andy.irawan@wtsindonesia.com
info@wtsindonesia.com
www.wtsindonesia.com
WTSIndonesia
+62 21 506 789 68
Amended Protocol – The Preliminary Tax Refunds
Amended Protocol – The Preliminary Tax Refunds
The Government of Indonesia, through Minister of Finance Regulation (PMK) No. 28 of 2026, has introduced a revised framework for the preliminary tax refunds (pengembalian pendahuluan kelebihan pembayaran pajak). While the regulation retains the existing categories of eligible taxpayers—namely, compliant taxpayers, taxpayers meeting specific criteria, and low-risk taxable entrepreneurs (PKP Berisiko Rendah)—it introduces several substantive changes to strengthen oversight and ensure that the Preliminary tax refund facility is granted only to taxpayers with a strong compliance profile.
Under Article 7 of PMK 28/2026, the Director General of Taxes (DGT) must issue a Preliminary Tax Overpayment Refund Decision Letter (Surat Keputusan Pengembalian Pendahuluan Kelebihan Pajak or SKPPKP) if the review confirms that the application satisfies all formal requirements and an overpayment exists. If the requirements are not met, the taxpayer will receive a notification accordingly. The processing timeline remains unchanged: up to three months for Income Tax (PPh) applications and one month for Value Added Tax (VAT) applications. If the DGT does not issue a decision within the statutory period, the application is deemed approved by operation of law, providing greater certainty for taxpayers.
One of the most significant changes concerns taxpayers who meet specific criteria (Wajib Pajak Persyaratan Tertentu). Under the previous regulation, taxpayers with an annual gross turnover of up to IDR 5 billion were eligible to apply for the preliminary tax refunds. PMK 28/2026 under Art. 9, substantially, reduces this threshold to IDR 1 billion. As a result, many small and medium-sized enterprises that previously qualified for the facility may no longer be eligible.
PMK 28/2026 also tightens the requirements for low-risk taxable entrepreneurs (PKP Berisiko Rendah). While this category remains available to exporters, Suppliers to VAT collectors, and certain other qualifying businesses, the DGT is expected to apply a more rigorous assessment based on the taxpayer’s compliance history, business profile, and data available in the tax administration system.
Another notable development is the broader use of data analytics and third-party information in the review process. In evaluating refund applications, the DGT may now rely more extensively on internal databases and external data sources to verify the accuracy and consistency of the taxpayer’s claims. This reflects the increasing digitalization of tax administration and places greater importance on maintaining robust supporting documentation.
More broadly, PMK 28/2026 reflects a stronger policy focus on enhancing oversight and minimizing the risk of improper refunds. Although the preliminary refund mechanism remains an important cash-flow facility for compliant taxpayers, the revised rules demonstrate the Government’s intention to apply more targeted scrutiny and ensure that the facility is used appropriately.
In addition, the regulation resets the status of taxpayers previously designated as compliant taxpayers under the prior rules. Existing determinations are no longer valid, and taxpayers wishing to retain this status must submit a new application within the transition period stipulated by the DGT. The transitional rules also introduce a strict reapplication window from 1 to 10 June 2026. Failure to submit the reapplication within this period will result in the taxpayer losing access to the preliminary tax refunds facility.
What Should Taxpayers Do Now?
Taxpayers should reassess their eligibility under PMK 28/2026, particularly in light of the lower turnover threshold for taxpayers meeting specific criteria and the stricter assessment of low-risk PKP status. Businesses should also ensure that tax filings, payment records, and supporting documentation are complete and consistent with information available to the DGT and third parties. For taxpayers relying on the preliminary tax refunds as part of their working capital strategy, early preparation and a proactive review of compliance status will be essential to preserve access to this facility under the new rules.
Are you ready to meet the new PMK 28/2026 requirements—and secure your access to preliminary tax refunds before the deadline? We are ready to help.
Your Contacts
Tomy Harsono
Partner (Consulthink)
T +62 811 9196 939
Tomy.harsono@wtsindonesia.com
Andy Irawan
Manager
T +62 895 0612 2020
andy.irawan@wtsindonesia.com
info@wtsindonesia.com
www.wtsindonesia.com
WTSIndonesia
+62 21 506 789 68
Data Collection for Cross-Examination – PMK 8 of 2026
Data Collection for Cross-Examination – PMK 8/2026
The Minister of Finance issued PMK No. 8 of 2026, which expands the authority of Indonesia’s Directorate General of Taxes (DGT) to obtain additional tax-related data and information whenever previously submitted information is deemed insufficient. As an amendment to PMK 228/PMK.03/2017, this regulation strengthens Indonesia’s data-based tax oversight framework by shifting the DGT’s role beyond merely receiving routine information from government agencies, institutions, associations, or other parties. The Director General of Taxes is now expressly authorized to collect supplementary tax data related to specific events or transactions connected to a taxpayer’s tax obligations when existing data is considered inadequate for compliance monitoring or tax examination purposes. Such information may include data reflecting a taxpayer’s business activities, business turnover, income, and assets, thereby providing broader visibility into the taxpayer’s overall tax profile.
To ensure procedural legitimacy, requests for additional data must be made through an official written request addressed to the head of the relevant institution, clearly specifying the type of data required, the format and method of submission, and the legal or administrative basis for the request. Institutions receiving such requests are obligated to provide accurate data reflecting actual conditions within one month from receipt of the request, either electronically or through direct submission in accordance with applicable regulations. In addition to broadening the DGT’s authority, PMK 8/2026 also reinforces the principles of accountability and transparency. Under Article 5A, the Director General of Taxes is required to notify data-providing institutions regarding how submitted data is utilized, thereby promoting legal certainty and responsible governance in the use of tax information. This reporting mechanism is intended to ensure that the data collected is used appropriately for tax supervision and enforcement purposes while maintaining sound governance standards. Overall, PMK 8/2026 represents a significant step in strengthening Indonesia’s national tax administration system by combining broader data access, enhanced compliance testing capabilities, and greater transparency to support more effective tax enforcement without compromising principles of good governance.
Practical Impact on Businesses and Taxpayers
In practice, this means businesses will face significantly greater cross-verification across multiple data sources, including tax filings (SPT Masa and SPT Tahunan), financial statements, Coretax records, OSS/NIB registrations, LKPM reports, banking information, and third-party transactional data. Any inconsistencies—whether in reported revenue, withholding tax positions, related-party transactions, licensing information, or beneficial ownership structures—may be identified more quickly through integrated data matching systems.
As a result, companies should anticipate more data-driven audits, increased scrutiny over transfer pricing and affiliated transactions, and greater exposure to compliance risks arising not only from substantive tax issues but also from administrative mismatches.
For taxpayers, PMK 8/2026 effectively marks a shift in Indonesia’s tax administration—from a traditional reporting-based system toward a more comprehensive tax intelligence and enforcement model. This makes internal data consistency, documentation readiness, and strong coordination across functions (tax, finance, legal, and corporate secretarial) increasingly critical.
It is also important to note that taxpayer data may be cross-checked against various external sources. However, such data may not always be fully accurate or of high quality. Therefore, taxpayers should ensure the robustness and reliability of their own data sources, as well as maintain proper documentation to support their positions.
Is your business ready to face a new cross-examination tax data approach based on PMK 8/2026? We are here to help your company strengthen compliance, align reporting, and navigate this evolving regulatory landscape with confidence.
Your Contacts
Tomy Harsono
Partner (Consulthink)
T +62 811 9196 939
Tomy.harsono@wtsindonesia.com
Andy Irawan
Manager
T +62 895 0612 2020
andy.irawan@wtsindonesia.com
info@wtsindonesia.com
www.wtsindonesia.com
WTSIndonesia
+62 21 506 789 68
Further Filing Guidance Under The New Coretax System
Further Filing Guidance Under The New Coretax System
Further filing guidance under the Coretax system, as regulated by PER-3/PJ/2026, establishes clearer and more structured procedures for the submission, validation, and processing of tax returns (SPT).
Building on this framework, the regulation introduces a more stringent, system-driven approach to compliance by prioritizing electronic filing and reinforcing validation controls. An SPT is considered officially filed only after it has successfully passed system validation and a Bukti Penerimaan Elektronik (BPE) has been issued, replacing earlier practices in which proof of submission alone could suffice. At the same time, taxpayer data, including NPWP and reported information, is subject to enhanced real-time validation, increasing the likelihood of rejection in cases of discrepancies. As a result, the compliance focus shifts from merely meeting deadlines to ensuring the accuracy and acceptability of submissions, requiring stronger data integrity and system readiness.
In addition, the regulation narrows the availability of filing deadline extensions by limiting them to specific circumstances, such as ongoing financial statement preparation or audit, or delays in receiving withholding tax slips. SPTs that fail to meet the prescribed requirements may be treated as not submitted and subject to administrative sanctions. Overall, PER-3/PJ/2026—comprising five chapters and 25 articles—serves as a refinement of the Coretax implementation by the Directorate General of Taxes (DJP), replacing certain provisions under PER-11/PJ/2025 and aiming to enhance accuracy, consistency, and administrative efficiency in tax reporting.
Here is a summary of the PER-3/PJ/2026:
| Key Points | Article | Details |
| Definitions | Art. 1 | Key terms: Taxpayer (WP), Tax ID (NPWP), Tax Return (SPT), Taxpayer Portal, electronic documents, etc. |
| Tax Return Obligations | Art. 2 | Tax returns must be accurate, complete, clear, in IDR, and signed. Corporate taxpayers may use English and USD only for financial statements. |
| Tax Return Period | Art. 3 | Tax returns must be accurate, complete, clear, in IDR, and signed. Corporate taxpayers may use English and USD only for financial statements. |
| Submission Deadlines | Art. 4 | Annual SPT deadlines: · Individuals (3 months), · Corporate (4 months) after tax year-end |
| Extension | Art. 5 | Taxpayers may extend the Annual Income Tax Return (SPT) deadline by up to 2 months by notifying the tax authority before the due date. The request must include reasons, temporary tax calculations, and required supporting documents. |
| Approval of extension | Art. 6 | Approved/rejected by DGT; no response = deemed approved |
| Submission Methods | Art. 7 | Electronic (primary), in person, or via post/courier |
| Electronic Filing Requirement, In-Person Submission, Post/ Couriers Submission | Art. 8, 9, & 10 | · Mandatory e-filing; otherwise deemed not submitted. · Direct filing at tax offices or designated service locations. · One SPT per envelope with identity and delivery proof. |
| Validation | Art. 11 | NPWP validation prior to further processing |
| Tax Return Review | Art. 12 | SPT is reviewed to ensure it is properly signed, complete, compliant with language/currency rules, timely submitted, and includes all required documents. Additional checks apply for amended returns and underpaid paper filings, while incomplete submissions are deemed invalid. |
| Electronic System | Art. 13 | Automated validation and review via system |
| Electronic, In-Person, & Postal Receipt | Art. 14, 15, & 16 | · Electronic receipt (BPE) is valid proof of filing; its date is the official acceptance date. · Direct submissions are verified; if valid, a receipt is issued, otherwise rejected and returned. · Mail/courier submissions are verified; if valid, the shipping date is the filing date, otherwise deemed not submitted. |
| Data Recording | Art. 17 | For paper-based SPT that have received a receipt, the contents are recorded by the tax authority’s designated data processing unit. |
| Deemed not Submitted | Art. 18 | Conditions: incomplete, unsigned, no payment, etc. |
| Document format | Art. 19 | Standard formats for SPT-related documents (e.g., extension requests, receipts, and notifications) |
| Exemptions | Art. 20 | Certain taxpayers are not required to file SPT |
| Non-compliance → penalties apply | Art. 21 | Non-compliant SPT deemed not submitted → administrative sanctions |
| No refund if caused by errors (e.g. rounding, incorrect reporting) | Art. 22 | Certain reported tax overpayments are not recognized as refundable (e.g., due to calculation errors or ineligible credits), and in such cases, no refund process applies and the tax authority will issue a notification. |
| Old cases follow new regulation rules | Art. 23 | Upon enactment, pending 2025 SPT extensions and previously submitted 2025 individual SPTs (not yet processed or audited) will be handled under this new regulation. |
| Aligns with new Coretax framework | Art. 24 | Revokes parts of previous regulation (PER-11/PJ/2025) |
| Regulation applies from enactment date | Art. 25 | Effective date of the regulation |
Need expert assistance for your business tax matters? We are here to help.
Your Contacts
Tomy Harsono
Partner (Consulthink)
T +62 811 9196 939
Tomy.harsono@wtsindonesia.com
Andy Irawan
Manager
T +62 895 0612 2020
andy.irawan@wtsindonesia.com
info@wtsindonesia.com
www.wtsindonesia.com
WTSIndonesia
+62 21 506 789 68
consulthink in Indonesia rebrands as WTS Indonesia – Press Release
Press Release
consulthink in Indonesia rebrands as WTS Indonesia
WTS Global member firm Consulthink in Indonesia rebrands as WTS Indonesia, thus underlining its international positioning as a full-service tax firm with strong local expertise to its multinational clients, both inbound and outbound.
The rebranding underscores WTS Indonesia’s strong commitment to WTS Global as the world’s largest non-audit tax practice, combining tax advisory, tax compliance and tax digital services with seamless cross-border coordination and the highest criteria of service excellence and client centricity.
All WTS Global member firms share the ambition to act as long-term trusted advisors and deliberately refrain from conducting statutory audits to avoid conflicts of interest – a key differentiator when advising international businesses.
“The rebranding is a logical step in line with our approach of being locally rooted and globally connected. As WTS Indonesia, we intend to further benefit from WTS Global’s shared intellectual capital, global connectivity, and consistent quality criteria across jurisdictions,” said Tomy Harsono, Founding Partner, WTS Indonesia.
“More than 50% of our global member firms are now branded under the WTS name, with this trend continuing to increase. Together with our member firms, we are taking important steps towards a truly WTS-branded powerhouse, with the ambition to foster growth and ignite new business opportunities worldwide,” Jürgen Scholz, Chairman, WTS Global.
About WTS Indonesia: WTS Indonesia is an Indonesian tax and regulatory consulting firm providing end-to-end tax advisory, compliance, and dispute resolution services in a complex and evolving regulatory environment. The firm is supported by experienced tax professionals with extensive track records in managing Indonesian tax matters across various industries. WTS Indonesia’s service offerings include tax advisory, tax compliance, tax dispute resolution, mergers and acquisitions (M&A), corporate restructuring, transfer pricing, international tax advisory, and indirect tax advisory and compliance. The firm delivers practical, technically robust, and commercially focused solutions to address clients’ tax and regulatory challenges. WTS Indonesia’s professionals bring experience from leading consulting firms and possess strong technical expertise across multiple service lines. The firm is committed to maintaining high professional standards and delivering consistent, high-quality services aligned with clients’ business objectives.
About WTS Global: With representation in over 100 countries, WTS Global is a leading global tax practice offering the full range of tax services and aspires to become the preeminent non-audit tax practice worldwide. WTS Global deliberately refrains from conducting annual audits in order to avoid any conflicts of interest and to be the long-term trusted advisor for its international clients. Clients of WTS Global include multinational companies, international mid-size companies as well as private clients and family offices. WTS Global effectively combines senior tax expertise from different cultures and backgrounds and offers world-class skills in tax advisory, tax compliance and tax technology coupled with the ability to think like experienced business people in a constantly changing world.
WTS Global press contact:
WTS Global
Marie Christin Shenouda
T: +49 (0)89 28646-1929
For more information please see: wts.com
Your Contacts
Tomy Harsono
+62 811 9196 939
tomy.harsono@wtsindonesia.com
Andy Irawan
+62 895-0612-2020
andy.irawan@wtsindonesia.com
info@wtsindonesia.com
www.wtsindonesia.com
WTSIndonesia
+62 21 506 789 68
Assignments to Asia Pacific
Assignments to Asia Pacific
We are delighted to share the release of the updated editions of our booklets, “Assignments to APAC” and “Assignments to Europe.” These publications offer key insights into tax, social security, and immigration aspects to consider when deploying employees to the APAC region and Europe. They also serve as an important promotional resource for our member firms in both regions, highlighting their expertise in Global Mobility – particularly within the APAC region.
Your Contacts
Tomy Harsono
+62 811 9196 939
tomy.harsono@wtsindonesia.com
Andy Irawan
+62 895-0612-2020
andy.irawan@wtsindonesia.com
info@wtsindonesia.com
www.wtsindonesia.com
WTSIndonesia
+62 21 506 789 68
