August 15, 2025 | 07:32 pm
TEMPO.CO, Jakarta - The Center of Economic and Law Studies (Celios) said the implementation of progressive taxes could boost state revenue by up to Rp524 trillion. The finding was presented in its latest research titled “Respectfully, State Officials: Do Not Collect Taxes Like Hunting in a Zoo.”
Celios Fiscal Policy Director Media Wahyudi Askar said the public is willing to pay taxes if the system is fair. He noted that, in percentage terms, the poor bear a greater tax burden than the super-rich who earn tens of billions of rupiah per month.
One of the proposed schemes is a wealth tax, which would impose a 2 percent levy on the total net wealth of individuals, including land, property, stocks, vehicles, artwork, and savings accounts. Media said taxing just the richest 50 individuals in Indonesia could generate around R 81 trillion.
He made the statement during a public discussion at the Celios office in Jakarta on Tuesday, August 12, 2025.
The Celios study also recommends ten other types of progressive taxes with potential revenue gains, including:
Reviewing inappropriate tax incentives (Rp137.4 trillion)
Carbon tax (Rp76.4 trillion)
Coal production tax (Rp66.5 trillion)
Windfall profit tax in the extractive sector (Rp50 trillion)
Tax on biodiversity depletion (Rp48.6 trillion)
Digital tax (Rp 29.5 trillion)
Increased inheritance tax rate (Rp20 trillion)
Third home ownership tax (Rp4.7 trillion)
Capital gains tax (Rp7 trillion)
Excise tax on sweetened packaged beverages (Rp3.9 trillion)
Earlier, Finance Minister Sri Mulyani Indrawati predicted that 2025 tax revenue would fall short by Rp 112.4 trillion from the target. Speaking in a working meeting with the DPR on Thursday, July 3, 2025, she estimated revenue would reach Rp 2,076.9 trillion out of the Rp 2,189.3 trillion target, or about 94.9 percent.
Sri cited three main reasons for the shortfall. The first was the cancellation of the VAT increase on most goods, applying it only to luxury items.
The planned increase from 11 percent to 12 percent could have raised Rp70 trillion. The second reason was the retention of several tax incentives. The third was lower-than-expected commodity prices. She said the Directorate General of Taxation is working to minimize the gap between realization and the budget target.
Ministry of Finance data showed tax revenue in the first five months of 2025 reached Rp683.3 trillion. Bright Institute senior economist Awalil Rizky said this was lower than in the same period of 2022, 2023, and 2024.
Awalil said the figure amounts to just 31.20 percent of the 2025 target, the lowest on record and even below the 35.45 percent achieved during the pandemic in 2020.
He noted that tax revenue also missed the target last year and predicted a similar or worse outcome this year, attributing the slump to an economy still in recovery and weakening purchasing power since last year.
Ilona Estherina and Anastasya Lavenia Yudi contributed to this article.
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