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Indonesia tax holiday reforms amid BUMN consolidation

Updated 2 times since CLSTR started tracking revisions of this situation.

What changed

2026-08-07 05:34 UTC → 2026-08-07 07:03 UTC · added removed

In early August 2026 the World Bank urged Indonesia to phase out its corporate‑income‑tax holiday scheme within one to two years, recommending performance‑based incentives and a broader review of tax incentives to curb overlap, inefficiency and evasion. The same week the Finance Minister announced a three‑year tax exemption limited to merger, acquisition and liquidation activities linked to the consolidation of state‑owned enterprises under the Badan Pengelola Investasi (BPI) Danantara. Following that policy signal, Danantara Indonesia accelerated the BUMN streamlining programme, using the exemption to reduce the number of state‑owned entities to roughly 250. By mid‑2026 the initiative had already reorganised 274 companies and set a target of 652 eliminations. InfraNexia, Danantara’s telecom‑infrastructure subsidiary, reported first‑half‑2026 revenue of Rp 7.7 trillion, with a 12.7 % rise in wholesale network sales and a 31 % increase from non‑TelkomGroup customers, highlighting expanding digital demand. The Saudi Ministry of Investment’s proposal for a stake in Madinah airport further signals international interest in the reform‑driven restructuring. Together, Bank Indonesia’s July 2026 data showed foreign‑exchange reserves at US$145.3 billion, a marginal dip of US$0.3 billion from June. While the World Bank’s recommendation, level remains well above the targeted tax exemption, and three‑month import‑coverage benchmark, it underscores the ongoing consolidation and infrastructure expansion illustrate Indonesia’s balancing act between curbing broad tax holidays and using importance of external‑sector resilience as Indonesia pursues selective tax incentives and BUMN consolidation to improve fiscal health, efficiency health and digital development. macro‑economic stability.

Versions

  1. 2026-08-07 07:03 UTC Indonesia tax holiday reforms amid BUMN consolidation
  2. 2026-08-07 05:34 UTC Indonesia tax holiday reforms amid BUMN consolidation
  3. 2026-08-05 13:15 UTC Indonesia tax holiday policy reforms

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