DJP Mulls Revising Final Construction Service Tax as Projects

Tax Director Bimo Wijayanto said on Wednesday, 15 October 2025, that the Directorate General of Taxes is considering a review of the final income‑tax scheme for construction services. The review is prompted by a decline in large‑scale construction projects in Indonesia.

The final tax, a one‑time levy ranging from 1.75% to 6% of revenue, is governed by Government Regulation (PP) No. 51/2008 and was amended by PP 9/2022. Article 10D of PP 9/2022 requires an evaluation three tax years after its enactment on 21 February 2022, making the timing appropriate for assessing fairness of the rates relative to construction firms’ profitability.

A revision could align the tax rates more closely with actual profits, lessen the burden on firms that incur losses, and adjust tax policy to the current market environment with fewer major projects. Read the full source at news.ddtc.co.id (https://news.ddtc.co.id/berita/nasional/1814463/tak-banyak-proyek-djp-pertimbangkan-reviu-pph-final-jasa-konstruksi).