The Indonesian government is once again overhauling its tax administration system by issuing Minister of Finance Regulation (Peraturan Menteri Keuangan/PMK) Number 28 of 2026 concerning Procedures for Preliminary Refunds of Tax Overpayments. The regulation replaces PMK Number 39/PMK.03/2018 and its amendments, which were deemed no longer aligned with today’s tax environment.
The new regulation forms part of the government’s broader effort to reinforce legal certainty, improve oversight accuracy, and accelerate tax refund services. At the same time, it fortifies Indonesia's ongoing modernization of its tax administration system by increasing reliance on digital validation and risk management.
Accelerated Tax Refunds Under PMK 28/2026
A preliminary refund of tax overpayment, or an accelerated tax refund, is a scheme that allows eligible taxpayers to obtain a tax refund without first undergoing a full tax audit. Under this mechanism, the Directorate General of Taxes (DGT) conducts only a limited administrative review before issuing a Preliminary Tax Overpayment Refund Decision Letter (Surat Keputusan Pengembalian Pendahuluan Kelebihan Pajak/SKPPKP).
The policy is primarily intended to improve business liquidity while delivering more efficient tax services. More broadly, PMK Number 28 of 2026 reflects a shift in tax administration from a traditionally enforcement-driven approach toward one that emphasizes trust and risk assessment.
The regulation divides accelerated tax refund recipients into three categories:
- taxpayers with specific criteria;
- taxpayers with specific requirements; and
- low-risk taxable entrepreneurs (pengusaha kena pajak/PKP).
The classification indicates the government’s increasing adoption of a risk-based tax administration model.
Requirements for Taxpayers With Specific Criteria
Taxpayers who meet specific criteria may receive accelerated refunds for overpayments of income tax and value-added tax (VAT). However, the status is available only to taxpayers who meet several strict compliance requirements.
These include:
- timely filing of tax returns;
- no outstanding tax arrears;
- financial statements receiving an unqualified audit opinion for three consecutive years; and
- no convictions for tax-related criminal offenses within the past five years.
Timely filing remains one of the primary indicators of formal tax compliance. Taxpayers must consistently submit annual tax returns and file monthly tax returns for the January - November period over the past three years. Although limited delays are tolerated, they may not exceed three tax periods and cannot occur consecutively.
In addition, taxpayers must not have overdue tax liabilities unless they have obtained official approval for installment payments or payment deferrals. This requirement reinforces the principle that accelerated tax refunds are intended only for taxpayers with strong compliance records.
Financial Statements and Data Integrity
PMK Number 28 of 2026 places great emphasis on the quality of financial statements. To qualify, taxpayers must obtain an unqualified audit opinion for three consecutive years. Notably, even an unqualified opinion accompanied by an explanatory paragraph cannot be used to satisfy the requirement.
The regulation also disqualifies financial statements that have been restated due to material errors or data manipulation. In addition, fiscal corrections arising from tax audits may not exceed 5% of the reported fiscal profit or loss.
These provisions imply the government’s intention to ensure that accelerated tax refunds are granted only to taxpayers with sound corporate governance and reliable financial reporting practices.
Taxpayer Status Application Process
Applications for specific criteria taxpayer status must be submitted electronically through the taxpayer portal by January 10 each year. The fully digital application process reflects the government’s push toward more transparent, efficient tax administration.
Under the regulation, the Director General of Taxes must issue a decision within 30 working days of receiving the application. If no decision is issued within that timeframe, the application is deemed automatically approved. This deemed approval mechanism is designed to provide greater legal administrative protection for taxpayers.
Once granted, the status remains valid unless revoked by the DGT. Revocation may occur if the taxpayer subsequently files tax returns late, accumulates tax arrears, receives a non-unqualified audit opinion, or becomes subject to a preliminary evidence audit or tax investigation.
Review for Accelerated Tax Refunds
To apply for an accelerated tax refund, taxpayers must indicate their request in the preliminary refund section of the tax return. The DGT will then conduct a limited formal and material review of the submitted data.
The formal review covers:
- taxpayer eligibility status;
- filing timeliness;
- payment compliance; and
- the absence of ongoing audits or investigations.
Failure to satisfy any formal requirement will result in the rejection of the accelerated tax refund request. Meanwhile, the material review focuses on the accuracy of tax calculations, withholding tax slips, tax collection slips, tax payment validation, and the validity of input tax. Importantly, this process does not constitute a full tax audit. Instead, it serves as an administrative verification process supported by electronic data analysis.
Tax Invoice and NTPN Validation
For VAT refunds, tax invoice validation plays a central role under PMK Number 28 of 2026. Input tax may only be recognized if they are supported by tax invoices properly recorded in the DGT’s administration system.
Tax payments are also verified through the treasury receipt number (nomor transaksi penerimaan negara/NTPN). Payments that cannot be validated in the tax administration system cannot serve as the basis for a tax refund claim.
The regulation further demonstrates the government’s increasing reliance on integrated digital tax data and electronic validation systems as the foundation of modern tax administration.
Deadline for Issuing the SKPPKP
PMK Number 28 of 2026 also introduces strict timelines for issuing preliminary tax refund decisions. For income tax refunds, the SKPPKP must be issued within 3 months of receipt of the application. For VAT refunds, the deadline is one month.
If the DGT fails to issue a decision within the prescribed timeframe, the application is automatically considered approved by law. The provision is intended to strengthen legal certainty while helping businesses maintain healthier cash flow.
Accelerated Refunds for Certain Taxpayers and Low-Risk PKPs
Besides meeting specific criteria, the regulation grants accelerated tax refunds to taxpayers who meet certain requirements, primarily small and medium taxpayers with relatively small refund amounts.
For individuals conducting business or independent professional activities, the tax refund limit is capped at IDR 100 million. For corporate taxpayers, the policy applies where annual turnover does not exceed IDR 50 billion, and the tax overpayment does not exceed IDR 1 billion.
Meanwhile, for PKPs, accelerated VAT refunds may be granted if total taxable deliveries do not exceed IDR 4.2 billion and the VAT overpayment does not exceed IDR 1 billion. The policy is widely seen as beneficial for MSMEs that frequently experience VAT overpayments.
The settlement process for these taxpayers is also relatively fast, 15 working days for individuals and 30 working days for corporate taxpayers and VAT refunds.
PMK Number 28 of 2026 also provides a special accelerated tax refund mechanism for low-risk PKPs. This category includes publicly listed companies, state-owned enterprises (SOEs), primary customs partners, authorized economic operators, manufacturers, pharmaceutical distributors, medical device distributors, and certain SOE subsidiaries.
Low-risk PKPs may apply for accelerated VAT refunds every tax period, making the scheme particularly important for exporters and industries that routinely accumulate excess input tax.
One essential requirement is that at least 80% of business activities must involve exports, transactions with VAT collectors, or transactions where VAT is not collected.
Overall, PMK Number 28 of 2026 marks another major step in the government’s effort to modernize Indonesia’s tax administration system. Through accelerated tax refunds, the government aims to improve legal certainty, support business cash flow, encourage voluntary compliance, and strengthen digital-based tax administration.
Also read:
Article 26 Withholding Tax on Foreign Taxpayers
