Celios Explains Potential State Revenue through Windfall Tax

The Center of Economic and Law Studies (Celios) states that the imposition of windfall tax on extractive companies has the potential to add trillions of rupiah to state revenue from taxes each year. “The bad news is, it is currently being held back by the government,” said Celios researcher Jaya Darmawan during a discussion in Central Jakarta on Thursday, 30 April 2026.

Windfall tax is an additional tax levied on a company’s unexpected profits, for example, due to a surge in global commodity prices resulting from geopolitical dynamics.

With this, the tax is not imposed because a company is experiencing excess profits from its performance. “When there is an unexpected increase in net profit, it should also be taken by the state. So there is no double taxation,” he explained.

Jaya said that windfall tax has already been implemented in other countries such as the UK, Italy, and India. He explained that the UK was the first country to implement the tax on energy companies and applied it in stages.

Initially, the rate was 25%. Then the figure rose to 38% in 2024. He said that the UK utilises the tax revenue to stabilise its fiscal position from the deficit side and to subsidise poor communities.

Jaya explained that based on the assumption of a 25% windfall tax on coal exports and an exchange rate of Rp17,324 per US dollar, the tax on unexpected income from coal companies could contribute up to Rp66 trillion to state revenue per year.

Besides coal, Jaya estimates potential state revenue of up to Rp14 trillion per year from nickel. Jaya said that not all nickel is used for electric vehicle (EV) production or energy transition projects.

He said that production not used for energy transition projects should also be subject to windfall tax. From a potential production of around 2.2 million tonnes per year, Jaya estimates that about 1.8 million tonnes, or the majority, has not yet undergone downstream processing. With an assumed windfall tax rate of 10%, Jaya estimates potential state revenue of up to Rp14 trillion per year from nickel companies. This tax revenue potential should be captured by the state to balance increasingly pressured finances.

In addition to windfall tax, Jaya encourages the imposition of tax on Indonesia’s 50 richest individuals, whose total wealth reaches Rp4,600 trillion, most of which is in the extractive sector. He said that by applying a 2% tax on these 50 super-rich individuals, Indonesia could potentially gain tax revenue of Rp93 trillion per year.