Indonesia

Individual - Significant developments

Last reviewed - 22 June 2022

The Omnibus Law introduces (i) changes in the foreign tax subject definition for Indonesian citizens and (ii) limited territorial taxation for expatriates.

The government issued the Harmonisation of Tax Regulations (Harmonisasi Peraturan Perpajakan or HPP) Law No. 7 Year 2021. The HPP Law brings several changes to existing sections of tax laws (General Tax Provisions and Procedures/Ketentuan Umum Perpajakan/KUP, Income Tax, VAT, and Excise) whilst also adding a new tax law section on the carbon tax. Some of the important changes to these laws include, but are not limited to, the changes to the individual income tax rate layer. We are awaiting follow-up implementing regulations to be issued, which will provide further guidance, especially on several new areas of changes.