Zero Tax on Electric Vehicles Cuts DKI Revenue

The Jakarta provincial government has highlighted the zero‑percent rate for Motor Vehicle Tax (PKB) and Vehicle Transfer Fee (BBNKB) on electric cars that remains in force until 31 December 2025. Head of the Regional Revenue Agency, Lusiana Herawati, said the measure reduces the region’s potential revenue by roughly Rp3 trillion. The loss occurs while electric‑vehicle sales have surged in the capital.

The tax exemption is stipulated in Law No 1 of 2022 on Central‑Local Government Fiscal Relations, which provides temporary incentives to accelerate electric‑vehicle adoption. However, the impact on local revenues has not been reassessed. DKI’s revenue agency has sought coordination with the Ministry of Finance to review the policy.

Maintaining the exemption could deepen Jakarta’s fiscal strain, especially after a 59 % cut in Transfer Funds (TKD) for the 2026 budget. The provincial administration plans to adjust tax measures and improve revenue collection without increasing taxpayer burdens. A policy review is expected to be completed before the end of 2025.