Purbaya and Said Iqbal Meet on JHT Tax Abolition, Here's the Discussion

Presidential Special Adviser for Employment and Labour Welfare, Said Iqbal, visited Finance Minister Purbaya Yudhi Sadewa at the Ministry of Finance to discuss a proposal regarding the abolition of tax on Old Age Security (JHT). Speaking after the meeting, Said, who is also President of the Confederation of Indonesian Trade Unions (KSPI), said that Purbaya responded positively to the proposal. He stated that Purbaya would conduct a study on the proposal to measure the impact of abolishing the JHT tax on state revenue. “The proposal for a zero per cent JHT tax will be studied seriously,” Said stated at the Ministry of Finance in Jakarta on Wednesday, 8 July 2026. “From what we gathered, he (Purbaya) wants to make changes in line with public expectations. But as Finance Minister, he also wants to first study the impact on tax revenue,” he said. Said mentioned that Purbaya actually held the view that progressive tax on JHT withdrawals should not be applied, because tax should only be levied once. “His view, which will be discussed internally at the Ministry of Finance, is that tax should be imposed once. Why should it be taxed repeatedly? He said this is not fair,” Said remarked. Said also noted that Purbaya would consider raising the threshold for JHT withdrawals subject to tax, using the increase in gold prices or the inflation rate as a reference. Under Government Regulation Number 68 of 2009, JHT withdrawals of up to Rp 50 million are not taxed. However, if the JHT balance exceeds Rp 50 million, the excess is subject to a final income tax rate of 5 per cent. This Rp 50 million threshold is now considered no longer relevant. “So the tax threshold for JHT could later consider gold prices or inflation. Thus, the limit will no longer be Rp 50 million. It could be Rp 100 million, Rp 200 million, or if using gold as a reference, Rp 400 million. These three options will be studied by his (Purbaya’s) team,” he said.