Three Proposals Submitted to Finance Ministry Regarding JHT Withdrawal Tax Polemic

Presidential Special Envoy for Labour and Workers’ Welfare Said Iqbal has submitted three proposals to Finance Minister Purbaya Yudhi Sadewa for consideration regarding the polemic over taxes on Jaminan Hari Tua (JHT) withdrawals. According to him, Purbaya is prepared to accommodate these proposals.

Firstly, the team requested that the tax on JHT be set at zero percent. The reasoning is that JHT falls under the category of social savings, which should be treated differently from commercial savings. As a form of worker protection, the tax on its withdrawal should be eliminated. If any tax is to be applied, it should only be on the investment returns, not the principal balance.

Secondly, they urged the removal of the progressive tax on JHT, in addition to zero-rating the principal tax. The progressive tax, which applies to individuals who make partial JHT withdrawals within a certain period and then withdraw again after more than two years, is considered unfair. This particularly affects workers who are laid off, withdraw a portion of their JHT, find new employment, and are then laid off again after more than two years.

Thirdly, the team proposed a more reasonable calculation for the taxable threshold by benchmarking it against the price of gold. They argued that Government Regulation (PP) Number 68 of 2009, which sets the tax-free threshold at IDR 50 million, is outdated. When the regulation was enacted 17 years ago, IDR 50 million was equivalent to 152 grams of gold. At current prices, 152 grams of gold is worth approximately IDR 400 million. Therefore, they proposed that the fair taxable threshold should be raised to IDR 400 million and above.