Indonesian Finance Minister Promises No Taxes for the Poor
Finance Minister Sri Mulyani promised not to tax the poor, despite the 2026 tax target increase. She stated that the government would apply taxes based on people’s means, ensuring that the public feels a sense of fairness in the tax system.
“So, we will not tax those beyond their means,” Sri Mulyani said at the 2026 Draft State Budget and Financial Note Press Conference at the Directorate General of Taxes (DGT) Office in South Jakarta on Friday (August 15th).
“That (0.5 percent final income tax rate for MSMEs) will remain in effect. We hope this will make MSMEs feel favored, as many perceive that all business sectors, all entrepreneurs, especially those who are less fortunate, are burdened with taxes,” she added.
Therefore, President Prabowo Subianto’s aide emphasized that she will continue to seek tax revenue from other sources. This aligns with President Prabowo Subianto’s observation that many illegal activities in Indonesia remain undetected by the state.
“If there is the capacity (to pay taxes) and it complies with the laws and regulations, we will continue to enforce that,” he emphasized.
“Whether there are new taxes or new rates, we are not (increasing tax rates). We are focusing more on internal reform (at the Ministry of Finance),” he concluded.
