Govt Covers Six Percent VAT on Economy Flights for Nataru

The government, through Minister of Finance Regulation (PMK) No 71/2025 signed on 15 October 2025, introduced a VAT subsidy for economy‑class air tickets during the Christmas and New Year (Nataru) holidays. The 11 percent VAT is split, with 5 percent paid by passengers and 6 percent covered by the state. The measure applies to tickets purchased from 22 October 2025 to 10 January 2026.

VAT (Value‑Added Tax) on scheduled domestic air transport is normally levied at 11 percent on the base fare, fuel surcharge and other fees. Under the VAT DTP (government‑transfer) mechanism, the state assumes 6 percent of the taxable amount while passengers bear the remaining 5 percent. The subsidy is limited to flights operating between 22 December 2025 and 10 January 2026.

Sharing the tax burden is expected to lower ticket prices and support consumer purchasing power during the holiday period. Airlines must still issue tax invoices and submit electronic transaction reports to the Directorate General of Taxes by 30 April 2026. The benefit does not apply to non‑economy classes or flights outside the specified dates.