Antara News·Indonesia·Wednesday, September 23, 2026 at 03:47 PM

Indonesia plans alternative incentives to maintain investment appeal

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Imamatul Silfia, Uyu Liman

Jakarta (ANTARA) - The Indonesian Finance Ministry is designing alternative investment incentives to maintain the country's economic appeal while complying with the Global Minimum Tax (GMT) framework.

Speaking to journalists after the ANTARA Business Forum here on Wednesday, Finance Minister Suahasil Nazara explained that adjustments are necessary to meet international tax commitments without complicating the ease of doing business in Indonesia.

Under the GMT framework, if the corporate tax rate applied in a host jurisdiction falls below the global minimum — broadly set at 15 percent — a top-up tax mechanism allows the investor's home country to collect the shortfall.

"Indonesia has taxing rights, and the investor's home country also has taxing rights. If Indonesia does not exercise its right, the home country is allowed to collect it. Therefore, it is better for us to collect it," Nazara explained.

He emphasized that adapting to the new global rules does not mean the government will stop supporting businesses. Instead, Jakarta will seek alternative facilities that offer operational benefits to investors without violating international tax regulations.

"We will provide other forms of incentives designed in collaboration with the business sector, ensuring our enterprises can still enjoy conveniences, faster licensing processes, and other ease," he said.

Asked whether the new scheme would take the form of tax credits, the minister noted that the government is developing a broad portfolio of instruments rather than a single substitute.

Adapting to the GMT will not involve a simple one-to-one replacement of old incentives, he added.

"The new schemes will be diverse; we are designing a variety of them. It is not a one-on-one replacement where the GMT is implemented and a single direct substitute is introduced," he stated.

Potential alternatives include import duty exemptions for specific products and targeted tax facilities for certain goods and transactions.

Nazara reaffirmed that the government will maintain robust pro-investment policies, structurally aligning them with Indonesia's obligations under the global minimum tax regime.

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