Tax Deductions and Family Sharing: Tips for Managing Eid Allowance to Make It Last
JAKARTA — The arrival of Tunjangan Hari Raya (THR, or Eid allowance) is eagerly awaited by most Indonesian workers.
THR is often regarded as supplementary income used to support various activities during Ramadan or Eid al-Fitr (Idul Fitri). However, unfortunately, THR frequently runs out quickly, often well before Eid arrives.
Many workers are often unaware why their THR disappears so rapidly, seeming to vanish into thin air. Meanwhile, Rizki Khoirudin (25), a private sector employee from South Jakarta, admitted to feeling sad when his THR ran out before Eid al-Fitr.
“What can I do? I personally don’t want to refuse giving money to my parents. But it will be replaced by God as long as we are sincere—there is sadness, but God’s calculator is different,” he said when interviewed in South Jakarta on Monday.
From a total THR of Rp5 million, only approximately Rp500,000 was left for him to enjoy personally for purchasing Muslim attire, with the remainder distributed among family members. He also had to cover the cost of returning to his hometown from his regular salary or savings.
In total, his spending to celebrate Eid with family, including travel costs, nearly reached Rp10 million. Nevertheless, he expressed acceptance because Eid al-Fitr is celebrated only once a year.
“It’s not the full allowance because the tax deduction is too large,” said Fitria when interviewed in South Jakarta on Monday.
According to her payslip, the tax deduction on her THR reached Rp423,000. Yet she is a mother with two young dependent children.
Fitria believed that Rp423,000 would be substantial for meeting her children’s milk needs until the following month. Tax deductions became one reason her private sector THR depleted more quickly this year.
“It runs out so quickly—it’s already gone before Eid, because of family sharing and the tax deductions,” she added.
Rista Zwestika CFP, WMI, WPS, QFC, a financial planner at Finante.ic, stated that the rapid depletion of THR before Eid is a phenomenon experienced by many people annually.
“Many people view THR as ‘extra money to spend’, not as part of a financial strategy,” Rista said when contacted by Kompas.com on Monday.