Elderly Trend and Tax on Pension Benefits in Indonesia

Statistics from Indonesia's Central Bureau of Statistics indicate that the number of people aged 60 and above continued to rise in 2025. This demographic shift reflects the country's aging population.

Pension benefits, including mandatory pension funds and retirement allowances, are subject to Income Tax (PPh) under the Income Tax Law, with a specific Non‑Taxable Income (PTKP) threshold. Certain pension components may receive exemptions or preferential rates according to current regulations.

The expanding retiree base can increase tax revenues, while clear understanding of the tax scheme assists retirees in managing fiscal burdens and helps employers plan their tax obligations. This has implications for both personal and public financial stability.