Jakarta implements groundwater tax to regulate usage

The DKI Jakarta Provincial Government utilizes Groundwater Tax (PAT) to serve two primary purposes: regulatory and budgetary. As a regulatory instrument, the tax aims to control groundwater extraction to prevent environmental damage, such as land subsidence caused by excessive use.

As a budgetary instrument, the tax serves as a source of regional revenue to fund public services and urban development. Under Regional Regulation Number 1 of 2024, the tax rate is set at 10% for qualifying commercial groundwater usage.