Indonesia Implements 12% VAT from 2025, Exempts Essential Goods and Services

• The government implemented a 12 percent Value Added Tax starting January 1, 2025
• Coordinating Minister Airlangga Hartarto announced the VAT increase aligns with the Tax Regulation Harmonization Law
• Essential goods and services like food, education, and health will have a VAT of 0 percent
• To support low-income families, the government will cover 1 percent of the VAT on basic goods, effectively making the VAT 11 percent for these items
• Specific goods such as packaged cooking oil, wheat flour, and industrial sugar will also have a VAT of 11 percent due to government subsidy
• The economic stimulus aims to maintain the purchasing power of the community, focusing on essential needs and supporting the food and beverage industry

Source: voi.id

Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.

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