Closing Tax Leaks to Ensure Economic Justice

How fairly the burden is distributed, how small the space for non-compliance remains, and how high public trust in fiscal institutions are critical considerations.

Jakarta (ANTARA) - The tax revenue target of Rp2,908 trillion for 2027 presents a major challenge for the government. Amid the need to maintain fiscal sustainability, public purchasing power, and economic growth momentum, increasing state revenue must be pursued without adding excessive pressure on groups of people and business actors who have already fulfilled their tax obligations.

Therefore, the government’s policy direction to strengthen supervision over potential revenue leaks deserves special attention. Efforts to increase revenue should not rely solely on expanding levies or increasing the burden on the existing tax base, but also through improving compliance, strengthening supervision, and enforcing the law against large-scale potential violations.

At the end of August 2026, Finance Minister Purbaya Yudhi Sadewa revealed that investigations are underway regarding 40 companies in the steel and building materials manufacturing sectors, which are estimated to be linked to potential state revenue leaks of approximately Rp4 trillion to Rp10 trillion.

The government also indicated a potential loss of revenue of up to around Rp1 trillion per year from one entity being examined more deeply. This potential loss relates to obligations regarding Income Tax (PPh), Value Added Tax (PPN), and raw material import activities.

These initial findings must be followed up through an audit and law enforcement process that is transparent and in accordance with regulations. The principle of the presumption of innocence must be maintained. However, the magnitude of the potential revenue mentioned by the government shows that there is still significant room to improve compliance and close fiscal leaks.

This issue is important because low tax revenue cannot always be explained solely by public compliance. There are structural issues that must also be addressed, ranging from the effectiveness of supervision, data integration, and the quality of tax administration to the integrity of the officials operating the system.

For this reason, the agenda to increase tax revenue can simultaneously serve as a momentum to strengthen fiscal justice. Those who have been compliant should not continue to be the easiest targets when the state requires additional revenue. Preventing distortion…