Economist: Protection for Ride-Hailing Drivers Must Go Hand in Hand with 8 Percent Cut

Jakarta (ANTARA) - Nailul Huda, Director of the Digital Economy at the Center of Economic and Law Studies (Celios), believes that protections for platform-based workers, such as ride-hailing drivers (ojol), must proceed alongside the reduction in income deductions taken by app companies, set at 8 percent. This follows Presidential Regulation (Perpres) No. 27 of 2026, which was signed and announced by President Prabowo Subianto during the International Labour Day/May Day commemoration on Saturday (1/5). “This social protection regulation serves as the basis for businesses to register all parties in the national social security system, both for employment and health,” Huda said when contacted in Jakarta on Monday. Regarding the 8 percent reduction in income deductions for ojol partners by the apps, Huda reminds of the importance of further studies and comprehensive dialogue with all relevant parties to avoid mutual losses. “As I mentioned previously, when the fare to the driver is a fixed cost, the reduction in deductions to the app does not necessarily increase the ojol partners’ income,” Huda said. “They are still given a fixed fare, and the reduced deduction only lowers the platform’s share from the fare side; the platform can still adjust on the app fee side, and the consumers are the ones who suffer, as this cut becomes the reason for no more discounts or reductions,” he added. He assesses that on-demand service demand could potentially decrease, thus reducing aggregate income for partners as well as for the apps. Huda warns that if this continues, it could affect the sustainability of Indonesia’s online transportation industry. Therefore, regulations to limit profits must be managed well and involve all relevant stakeholders, so that the business climate in platform-based transportation services in Indonesia can continue to operate. “The interests of partners in obtaining social protections are certainly important. Maintaining the ecosystem of the online transportation industry is also important,” Huda stated. Previously, President Prabowo had signed Presidential Regulation (Perpres) No. 27 of 2026 to reduce the income deduction taken by app companies from ride-hailing drivers to 8 percent. The President assessed that the previously applicable revenue-sharing scheme still did not provide justice for the drivers. Through this new regulation, the government sets a much lower new standard to increase the net income of online transport workers.