Celios: Windfall tax could boost state revenue by Rp66.03 trillion
Jakarta (ANTARA) - The Center of Economic and Law Studies (Celios) calculates that applying a windfall tax, or tax on unexpected profits, to coal companies could potentially increase state revenue by up to Rp66.03 trillion.
“So, Mr Purbaya (Finance Minister Purbaya) doesn’t need to worry and get stressed. Implement the windfall tax immediately,” said Celios researcher Jaya Darmawan in a statement received in Jakarta on Saturday.
Meanwhile, if the windfall tax is applied to nickel companies, he calculates that the state could gain up to Rp14.08 trillion.
According to Jaya, the momentum for implementing the windfall tax in Indonesia is currently growing stronger.
The surge in profits in the energy sector is evident from coal prices that once reached 145.86 US dollars per tonne in March 2026 and global nickel prices reaching 19,363 US dollars per tonne at the end of April this year.
This surge occurred unexpectedly and not due to company performance, thus representing untapped revenue potential amid strained state budget health that has already impacted society.
From the perspective of fiscal natural resources, Indef economist Aryo Irhamna highlights that the design of state revenue from the extractive sector still uses instruments inherited from the oil and gas era, even though the largest contribution now comes from coal, which accounted for 51.7 percent of non-tax state revenue from natural resources in 2024, up from just 9.5 percent in 2009.
Based on an analysis of arc elasticity on the realisation of non-tax state revenue from natural resources data from 2014-2023, he shows that the current gross revenue-based royalty system (Government Regulation 18/2025) does not capture windfalls proportionally.
When coal prices rose sixfold, state revenue did not increase sixfold, said Aryo.
The difference becomes supernormal profit in the hands of producers.
“Our simulation shows that over 12 years without a windfall capture instrument, Indonesia lost potential revenue of around Rp592 trillion from the oil, gas, and coal sectors,” said Aryo.
Aryo proposes two parallel reform pathways.
First, a quick win within 9-12 months, namely revising Government Regulation 18/2025 and Government Regulation 19/2025 to make royalty rates more responsive to market conditions, accompanied by a presidential regulation to allocate revenue during high prices to a stabilisation fund.
This pathway does not require new legislation, so it can be executed immediately.
Second, a long-term pathway by preparing a Progressive Resource Rent Tax (PRRT) Bill, a progressive tax on economic rent that automatically becomes zero when prices are low and only activates when profits exceed normal levels.
According to him, both are not substitutes but two different fiscal layers with distinct functions, namely more responsive royalties in the non-tax state revenue realm, and PRRT as a permanent windfall capture tax in the taxation realm.
“If the government succeeds in implementing the windfall tax, this will be a good legacy for the future, provided it is well prepared,” said Aryo.