To strengthen economic growth and job creation, the Ministry of Finance has issued Regulation No. 72/2025 (“PMK-72”), which amends PMK No. 10/2025 (“PMK-10”) regarding Article 21 Income Tax Borne by the Government (“PPh 21 DTP”). The amendment broadens the incentive coverage to include the tourism sector, marking a significant extension of the government’s 2025 fiscal stimulus program.

Previously, the PPh 21 DTP facility was available only for employees in labor-intensive manufacturing industries—such as footwear, textiles and garments, furniture, and leather goods. Through this new regulation, tourism businesses are now also entitled to the same tax relief, recognizing the sector’s vital role in Indonesia’s economic recovery and regional employment.

Under the scheme, employers continue to withhold Article 21 Income Tax from employee salaries as usual. However, the portion of the tax that qualifies will be borne by the government, not the employee.

PMK No. 72/2025 also sets different incentive periods:

• For manufacturing sectors, the Article 21 DTP applies from January to December 2025.
• For the tourism sector, it applies from October to December 2025, aligning with the peak holiday and travel season.

The regulation introduces new provisions regarding excess withholding and compensation. Generally, any overpaid PPh 21 DTP is not refundable. However, for tourism businesses, any excess amount not covered by the government may be refunded to employees or carried forward to the next tax period. To implement this, employers must prepare a calculation worksheet and an additional withholding slip in the prescribed format and submit both through the Directorate General of Taxes (DGT) portal.

Employers utilizing this incentive are required to:

• Pay the DTP amount directly to employees upon salary payment;
• Exclude the DTP portion from taxable income; and
• Report the utilization in their monthly PPh 21/26 returns.

Non-compliance with reporting or documentation requirements may lead to revocation of the incentive.

Through PMK-72, the government reaffirms its commitment to supporting strategic sectors through targeted tax incentives. By extending the PPh 21 DTP facility to the tourism industry, this policy is expected to protect jobs, boost disposable income, and sustain the momentum of Indonesia’s economic acceleration in 2025.

The regulation officially took effect on 28 October 2025.