Will Income Tax Revenues Increase as Taxpayer Layer Expanded?

By Editorial Team 04/10/2021
businessman and tax
Summary

The government and the House of Representatives (DPR) will immediately pass the Bill on Tax Regulations Harmonization (HPP). One of the new provisions in the HPP Bill is the formulation for calculating personal income tax (PPh) with an annual income basis. In the existing regulation, the government set four layers of income for calculating income tax. Meanwhile, the Bill sets out five layers.

Here are the details:

  1. Up to Rp 50 million: five percent income tax rate.
  2. Rp 50 million-Rp 250 million: 15 percent income tax rate.
  3. Rp 250 million-Rp 500 million: 25 percent income tax rate.
  4. Rp 500 million-Rp 5 billion: 30 percent income tax rate.
  5. Above Rp 5 billion: 35 percent income tax rate.

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