The Ministry of Finance has issued Finance Minister Regulation (PMK) No. 71/2026, revising the procedures for tax debt payments. The regulation, which amends PMK No. 118/2024, took effect on October 2, 2026.
Director General of Taxes Bimo Wijayanto said the main change concerns the allocation of payments. Previously, payments were allocated proportionally between the outstanding tax principal and administrative penalties. Under the new regulation, payments are prioritized for settling the principal tax debt.
“With this adjustment, taxpayers’ payments can first be used to settle the principal tax debt, giving them an opportunity to fulfill their principal obligations while also taking advantage of facilities for the reduction or waiver of administrative penalties, in accordance with applicable regulations,” Bimo said in a press statement in Jakarta on Monday (October 12, 2026).
PMK No. 71/2026 also revises the deadline for submitting responses to the results of tax objection reviews. In addition, it clarifies the provisions governing the reduction or waiver of administrative penalties.
However, not all penalties are eligible for these facilities. Administrative penalties arising from objection, appeal, or judicial review proceedings are excluded from the reduction or waiver mechanism under the regulation.
Bimo emphasized that the changes do not constitute a tax amnesty. Taxpayers remain obligated to pay their principal tax debts, while administrative penalties may only be reduced or waived if the taxpayers meet the stipulated requirements.
The government expects the revised payment mechanism to encourage the settlement of outstanding principal tax debts while improving voluntary compliance. The changes are also expected to give taxpayers greater flexibility in fulfilling their tax obligations in accordance with applicable regulations.
The policy is also expected to help taxpayers, including micro, small, and medium enterprises (MSMEs), manage their cash flow. This would allow them to settle their tax obligations while maintaining business continuity.
Also Read:
Tax Refunds Are a Right, Not a Fiscal Favor
What Is Tax in Indonesia?
Breaking Down the Article 21 Withholding Tax Provisions
Editor: Thomas Rizal
