Finance Minister Purbaya Boldly Offers Tax Exemption for Investors Entering Indonesia's Financial Special Economic Zone

Jakarta, CNBC Indonesia - Finance Minister Purbaya Yudhi Sadewa has stated his readiness to offer zero per cent tax for companies or investors entering Indonesia’s Financial Special Economic Zone (KEK) in Bali. Purbaya made this remark during a conversation with reporters at the Ministry of Finance office on Monday (4/5/2026).

Purbaya explained that he has no qualms about granting income tax (PPh) exemptions to companies or investors, as this arrangement would not result in losses for the government. He assured that the incentives in the Financial KEK would align with international standards.

“If in Indonesia I give 0%. Why do I give it? Originally, there wasn’t any anyway. So, zero is fine,” said Purbaya.

According to him, the entry of investors into the Financial KEK, which will be developed in the future, could actually bring in foreign exchange reserves for Indonesia. This is because investors entering could purchase government bonds, thereby adding to the government’s funding sources for development.

Moreover, Purbaya is not hesitant about investors potentially requesting low interest rates for Indonesian bonds in the future. Purbaya is confident because investors in the Financial KEK will increase the number of buyers for Indonesian bonds.

“Why? It can reduce funding for our bonds from other buyers, from other places. So, the supply of our bond buyers will increase,” he stated.

“This is a strategic step that will be realised in the near future. We’ll wait for the next steps. I’m just helping here,” said Purbaya enthusiastically.

Purbaya explained that Indonesia will emulate the Financial KEK model in Dubai, United Arab Emirates (UAE). There, he said, the financial centre is built on 100 hectares of land, applying common law, while the country’s Sharia law remains in effect.

“We can do the same. Later, in that place, the money can be invested anywhere in Indonesia,” he added.

In the context of global financial centres, common law is often regarded as an advantage because it provides greater legal certainty that is flexible and market-oriented.