Jakarta Restaurant Tax Threshold Rule Urged for Revision

The Indonesian Solidarity Party (PSI) and Prosperous Justice Party (PKS) factions have requested a revision to the restaurant tax threshold rule within the draft amendment to the Regional Regulation on Regional Taxes and Regional Levies currently being proposed by DKI Jakarta. PSI faction member Josephine Simanjuntak questioned why Article 45 paragraph (2) letter a of Regional Regulation Number 1 of 2024 was not being revised in the draft amendment. She noted that under the previous rule, food or beverage businesses with a turnover not exceeding IDR 42 million per month were exempt from restaurant tax or the specific goods and services tax (PBJT). Josephine argued this provision is no longer relevant to current economic conditions, citing Jakarta’s inflation rate of 2.78 percent as of June 2026 and food inflation of 0.41 percent. She stated the Jakarta provincial government should adjust the provision to reflect the reality of food and beverage MSMEs so they can remain profitable. The PSI faction believes the IDR 42 million turnover threshold needs to be reviewed to align with inflation, rising business costs, and the real conditions of MSMEs, ensuring fairer tax imposition. Meanwhile, PKS faction member Muhammad Al Fatih proposed raising the exemption threshold for food and beverage businesses from IDR 42 million to IDR 75 million per month. He also suggested that food and beverage businesses operating in school canteens should be exempt from the tax, citing their small profit margins and the continuous increase in raw material prices, with the majority being micro and household enterprises. The Jakarta Provincial Government has submitted the proposed amendment to Regional Regulation Number 1 of 2024 on Regional Taxes and Regional Levies, and various DPRD factions delivered their general views during a plenary session.