Tax Day 2026: When Reform Must Touch the Taxpayer
Tax remains the backbone of the State Revenue and Expenditure Budget (APBN). From infrastructure development to financing education, health, and various social protection programmes, almost everything depends on the state’s ability to collect tax revenue sustainably. Therefore, maintaining a strong taxation system is not merely a fiscal matter, but part of the effort to ensure the continuity of national development.
In recent years, the government and the Directorate General of Taxes (DJP) have carried out tax reforms on an unprecedented scale. Regulatory updates, administrative digitalisation, data integration, and service system modernisation demonstrate a commitment to building a more modern, transparent, and accountable tax administration. These achievements deserve appreciation as an important foundation for a taxation system that is increasingly adaptive to the development of the digital economy and the demands of good governance.
Tax Day, commemorated every 14 July, is a momentum to reflect on this reform journey. However, the question worth asking now is no longer whether tax reform has been carried out. The more important question is who has most felt the benefits of that reform. Have the changes merely strengthened the state administration system, or have they truly brought ease, certainty, and a better experience for taxpayers?
It is undeniable that Indonesia’s tax reform has shown significant progress. Administrative digitalisation has transformed many previously manual processes into electronic-based services. Registration, reporting, payment, and various administrative services are now increasingly accessible without being limited by space and time. On the other hand, data integration continues to be strengthened as the foundation of modern tax administration. The utilisation of cross-agency data allows tax authorities to obtain more accurate information to support both supervision and service. The integration of the Population Identification Number (NIK) with the Taxpayer Identification Number (NPWP) is one example of efforts to simplify administration while improving the quality of the tax database.
The reform is also marked by the development of Coretax as the foundation for a more integrated tax administration system. Although its implementation still faces technical challenges common in large-scale digital transformations, this policy direction shows the government’s seriousness in building a system capable of managing tax business processes more efficiently and digitally. The strengthening of risk-based supervision, the simplification of various administrative procedures, the expansion of electronic services, and the increase in formal taxpayer compliance are also part of the reform achievements that deserve recognition. All these steps indicate that Indonesia’s tax reform is no longer focused solely on increasing state revenue, but also on renewing administrative governance.
However, the success of reform should not be measured only from the government’s perspective. So far, the measure of reform success has often been linked to an increased tax ratio, increased state revenue, an increased number of registered taxpayers, or an increased number of submitted tax returns (SPT). All these indicators are important as they reflect the performance of the tax administration. But ultimately, tax reform is carried out to serve the public. Therefore, its success must also be measured from the taxpayer’s perspective. Are regulations becoming easier to understand? Are administrative processes becoming simpler? Do taxpayers obtain legal certainty when fulfilling their obligations? Are the compliance costs they must bear getting lower? And no less importantly, is the level of public trust in the tax administration increasing?
In modern tax administration literature, the taxpayer experience is one of the important indicators of reform success. A sophisticated system does not always result in high compliance if it is still perceived as complicated, expensive, or lacking in certainty. Conversely, a system that is simple, easy to use, and provides good service will be more effective in building voluntary compliance. Thus, tax reform is not enough just to build a modern system. Reform must also build a positive experience for the public as the main users of that system.
The polemic regarding the end of the utilisation period for the 0.5 percent Final Income Tax (PPh) tariff for MSMEs for some taxpayers can serve as an example of how tax reform needs to be viewed from the taxpayer’s perspective. It must be understood that the government is not abolishing the 0.5 percent Final PPh tariff for MSMEs. This tariff still applies to taxpayers who meet the requirements. However, in accordance with the time limits stipulated in the legislation, certain taxpayer groups, such as CVs, Firms, Limited Liability Companies (PT), and Village-Owned Enterprises (BUMDesa), can no longer utilise this tariff and must switch to the general Corporate Income Tax regime.
Conceptually, this policy has the right objective. The Final PPh was designed to lower compliance costs, broaden the tax base, and encourage MSME players to enter the formal sector. In many aspects, this policy has succeeded in opening easier access for business actors to fulfil their tax obligations. However, when the facility begins to expire according to the applicable provisions, questions arise regarding the readiness of taxpayers to face a more complex new regime.