In Order to Increase State Revenue, Here Are the Steps the Government Is Taking
March 31, 2026
At the limited coordination meeting held on Monday, March 16, 2026, at the office of the Coordinating Ministry for Economic Affairs, the Ministry of Finance stated that it would strive to increase revenue without raising taxes and would implement tax efficiency.
For your information, according to the February 2026 edition of the State Budget (APBN KiTA), tax revenue grew 30% in the first two months of 2026 compared to 2025. This indicates that the government’s efficiency efforts are considered quite successful, with a 30% increase in tax revenue. To ensure continued revenue growth, the government are taking the following steps:
- Tax Efficiency: Tax efficiency can be achieved by making adjustments to tax revenues and improving the community’s economy, which will have a direct impact on tax increases. The community’s economy is improving, as evidenced by the growth of VAT and Sales Tax on Luxury Goods. In the first two months of the year, VAT and Sales Tax on Luxury Goods growth reached 95% compared to the previous year. This indicates that the community’s economy is better this year than last.
- To plug tax revenue leaks, the Ministry of Finance will attempt to address these by identifying companies suspected of under-invoicing to increase state revenue. Under-invoicing is an illegal practice involving lowering the value of goods on import or export invoices to lower their actual value. This is intended to manipulate taxes and reduce import duties, potentially causing state losses. The Ministry of Finance has identified 10 companies engaging in under-invoicing.
- Not raising subsidized fuel prices. Amidst global turmoil and Iran’s blockade of the Strait of Hormuz, oil shortages could lead to soaring prices. However, the Ministry of Finance has not yet raised subsidized fuel prices and will review and optimize budgets for several programs within ministries and agencies to cover the price increase unless the price increases are too high.
The increase in state revenue growth is a positive sentiment amid the current international turmoil. This growth indicates that the domestic economy is still improving. The government is expected to continue maintaining revenue growth to prevent social anxiety disorder, or excessive fear in the community, due to the recent global turmoil. It is hoped that the government can also take steps that are considered strategic to boost state revenue.
By Olina Rizki Arizal – Partner
