Finance Minister Purbaya Dismisses Two Tax Officials Amid Uncontrolled Tax Refund Issues

JAKARTA - Finance Minister Purbaya Yudhi Sadewa has dismissed two tax officials after an internal investigation uncovered issues in the management of tax refunds, or the return of excess tax payments.

This action was taken after five officials were questioned for their alleged involvement in issuing large-scale refunds. From the initial examination, two of them were immediately removed from their positions.

“I am very serious about these refunds because their issuance has been somewhat uncontrolled. I investigated five officials who issued the highest amounts of refunds, and today I will dismiss two of them,” Purbaya stated during a media briefing at the Ministry of Finance headquarters in Jakarta on Monday (4/5/2026).

“The message is that when there is an instruction like that, implement it properly, don’t go overboard. So I’m not joking around,” he added.

For context, tax refunds involve returning funds to taxpayers when the tax paid exceeds the actual obligation.

According to the Directorate General of Taxes, refunds can occur due to taxes paid that were not actually due, or overpayments for types such as income tax (PPh), value-added tax (PPN), or luxury goods sales tax (PPnBM).

Purbaya revealed ongoing problems in reporting and controlling refunds, including inaccuracies in information provided to leadership. He cited an example where initially reported refund values were relatively small, but year-end realisations were significantly larger.

“In the meeting, I asked what the potential was, and my staff said it was small. At the end of the year, I only found out that the actual amount was many times what they mentioned,” he said.

To tighten supervision, the government has also reduced the accelerated PPN refund threshold from Rp 5 billion to Rp 1 billion. This policy aims to make cash outflows more controlled and avoid leakage risks.

Additionally, the Financial and Development Supervisory Agency (BPKP) is conducting an investigative audit of refund practices from 2016 to 2025.

Purbaya also mentioned findings in the coal sector that have caused the state to bear a burden of up to Rp 25 trillion due to PPN refunds.

“We want to control this so that refunds are more orderly. Especially in the coal industry, I’ve covered Rp 25 trillion in PPN. So I paid it, and there were inaccuracies in the calculations,” he stated.