PTKP Threshold May Increase, DJP to Seek New Tax Sources

The Directorate General of Taxes (DJP) of the Ministry of Finance has stated it is ready to seek new tax base sources if the government decides to increase the Non-Taxable Income (PTKP) threshold in 2027.

Director General of Taxes, Bimo Wijayanto, noted that raising the PTKP could potentially pressure tax revenue. However, he believes this impact can be anticipated through the expansion of the tax base, increased compliance, and the optimisation of the Coretax system’s performance.

“If the government decides to increase the (PTKP), that is fine,” Bimo said during a media briefing last week, as reported on Monday (5/10/2026).

Bimo explained that the DJP has not yet calculated in detail the potential loss in revenue if the PTKP is raised. He noted that the government first needs to determine the magnitude of the increase before the impact on revenue can be calculated.

“So, revenue will certainly change slightly. If it is decided that (PTKP rises), the consequence is that we must find a new tax base,” he said.

He further mentioned that the DJP has not yet received official instructions to calculate the impact of the PTKP increase on revenue, particularly regarding Income Tax (PPh). Nevertheless, the DJP has prepared several scenarios to anticipate such policy changes.

These scenarios have been submitted to the Directorate of Economic and Fiscal Strategy (DJSEF) of the Ministry of Finance for further study. Discussions regarding the policy framework for the PTKP increase will subsequently be conducted alongside the Coordinating Ministry for Economic Affairs.

“As for me, I have not been instructed (to calculate the impact on revenue). But looking at the progress of the dialogue within the Coordinating Ministry for Economic Affairs, we are ready. We have submitted the scenarios to the DJSEF,” Bimo explained.

Bimo stated that the government needs to consider several factors before determining the impact of the PTKP increase on tax revenue. One such factor is the revenue contribution from individual taxpayers in the highest income tax brackets.

With an increase in the PTKP, a portion of the public’s income will fall below the taxable threshold. This condition has the potential to reduce individual income tax revenue.

However, the DJP believes that this potential decline should not be an excessive concern if the government can find new tax base sources.

The discourse regarding raising the PTKP threshold emerged during a meeting at the State Palace last week (30/9/2026).

According to the Coordinating Minister for Economic Affairs, Airlangga Hartarto, the PTKP threshold will likely be equivalent to the Provincial Minimum Wage (UMP).

“Those earning the UMP will be tax-exempt,” he told journalists at his office in Jakarta on Friday (2/10/2026).

The current non-taxable income threshold stands at Rp54 million per year, or Rp4.5 million per month. Airlangga stated that under the current PTKP, there is a salary difference that remains subject to tax. For example, if a salary is Rp5 million per month, the annual total is Rp60 million. Based on the current PTKP, Rp6 million of that salary is subject to tax.

“This means the remaining 6 million must be subject to Income Tax (PPh),” Airlangga said.