Investment Ministry Prepares New Regulation on Tax Incentive Applications via OSS System
JAKARTA, DDTCNews — The Ministry of Investment and Downstreaming/Investment Coordinating Board (BKPM) is preparing new regulations governing the application for tax incentives through the Online Single Submission (OSS) system.
The regulation in question is a Draft Ministerial Regulation on Guidelines and Procedures for the Implementation of Risk-Based Business Licensing and Investment Facilities through the OSS System, which revises several previous regulations, including BKPM Regulation 4/2021.
"These investment facilities were previously regulated, but without a clear process flow," said Riyatno, Deputy for Investment Climate Development at the Ministry of Investment and Downstreaming, during a public consultation quoted on Friday (4 July 2025).
There are three new provisions related to investment facilities contained in the draft ministerial regulation prepared by the Ministry of Investment and Downstreaming/BKPM.
First, the addition of provisions regarding tax facilities in the Nusantara Capital City (IKN) and partner regions. Second, the detailing of mechanisms for applying for customs duty and tax incentives, from service level agreements (SLAs) to verification procedures. Third, the addition of rules related to non-fiscal facilities.
The non-fiscal incentives include: recommendations for green lane services; recommendations for the transfer of machinery that has received customs duty exemption facilities for re-export purposes; recommendations for the transfer of capital goods that have received customs duty exemption facilities for the construction or development of power generation industries for public use; and recommendations for the transfer of imported goods that have received customs duty exemption or relief and/or VAT exemption for contracts of work and coal mining cooperation agreements (PKP2B).
These three new provisions are considered necessary to provide legal certainty for business operators who are entitled to or have already received facilities.
"We invite the public to provide input to us. We will also convey the input from all of you to the Coordinating Ministry for Economic Affairs," said Riyatno.
As background, the function of OSS as a channel for business operators to apply for tax incentives has been affirmed in Government Regulation 28/2025. Under Article 188 paragraph (3) of GR 28/2025, the investment facilities subsystem is one of seven subsystems within the OSS system.
Features available in the investment subsystem include: applications for customs duty exemption on imports of machinery, goods and materials for the construction or development of industries under investment schemes; applications for customs duty exemption on imports of capital goods for the construction or development of power generation industries for public use; applications for customs duty exemption or relief on imports of goods under contracts of work or coal mining cooperation agreements; applications for corporate income tax reduction facilities (tax holiday); applications for income tax facilities for investment in certain business sectors and/or certain regions (tax allowance); applications for gross income reduction for practical work activities, apprenticeships and/or competency-based human resource development learning programmes (super tax deduction for vocational training); applications for gross income reduction for certain research and development activities in Indonesia (super tax deduction for R&D); and/or net income reduction facilities for new investment or business expansion in certain business sectors classified as labour-intensive industries (investment allowance).
The regulation in question is a Draft Ministerial Regulation on Guidelines and Procedures for the Implementation of Risk-Based Business Licensing and Investment Facilities through the OSS System, which revises several previous regulations, including BKPM Regulation 4/2021.
"These investment facilities were previously regulated, but without a clear process flow," said Riyatno, Deputy for Investment Climate Development at the Ministry of Investment and Downstreaming, during a public consultation quoted on Friday (4 July 2025).
There are three new provisions related to investment facilities contained in the draft ministerial regulation prepared by the Ministry of Investment and Downstreaming/BKPM.
First, the addition of provisions regarding tax facilities in the Nusantara Capital City (IKN) and partner regions. Second, the detailing of mechanisms for applying for customs duty and tax incentives, from service level agreements (SLAs) to verification procedures. Third, the addition of rules related to non-fiscal facilities.
The non-fiscal incentives include: recommendations for green lane services; recommendations for the transfer of machinery that has received customs duty exemption facilities for re-export purposes; recommendations for the transfer of capital goods that have received customs duty exemption facilities for the construction or development of power generation industries for public use; and recommendations for the transfer of imported goods that have received customs duty exemption or relief and/or VAT exemption for contracts of work and coal mining cooperation agreements (PKP2B).
These three new provisions are considered necessary to provide legal certainty for business operators who are entitled to or have already received facilities.
"We invite the public to provide input to us. We will also convey the input from all of you to the Coordinating Ministry for Economic Affairs," said Riyatno.
As background, the function of OSS as a channel for business operators to apply for tax incentives has been affirmed in Government Regulation 28/2025. Under Article 188 paragraph (3) of GR 28/2025, the investment facilities subsystem is one of seven subsystems within the OSS system.
Features available in the investment subsystem include: applications for customs duty exemption on imports of machinery, goods and materials for the construction or development of industries under investment schemes; applications for customs duty exemption on imports of capital goods for the construction or development of power generation industries for public use; applications for customs duty exemption or relief on imports of goods under contracts of work or coal mining cooperation agreements; applications for corporate income tax reduction facilities (tax holiday); applications for income tax facilities for investment in certain business sectors and/or certain regions (tax allowance); applications for gross income reduction for practical work activities, apprenticeships and/or competency-based human resource development learning programmes (super tax deduction for vocational training); applications for gross income reduction for certain research and development activities in Indonesia (super tax deduction for R&D); and/or net income reduction facilities for new investment or business expansion in certain business sectors classified as labour-intensive industries (investment allowance).