Indonesia: Experts urge removal of 11 percent VAT on sanitary pads

Public policy experts are calling for the elimination of the 11 percent Value Added Tax (VAT) on sanitary pads in Indonesia, arguing that the product is a biological necessity rather than a luxury item.

Achmad Nur Hidayat, a public policy observer from UPN Veteran Jakarta, stated that while the tax collection follows current regulations, it fails to reflect fiscal justice. He noted that because demand for sanitary pads is inelastic due to biological requirements, the tax imposes a disproportionate social burden on different economic groups.

The Directorate General of Taxes (DJP) has confirmed that sanitary pads remain classified as taxable goods and have not yet received VAT exemption facilities. Under Ministry of Finance Regulation Number 131 of 2024, non-luxury goods like pads are subject to a 12 percent VAT rate with a tax base of 11/12 of the selling price, resulting in an effective tax rate of 11 percent.