DGT Reform Drives 24.6% Growth in First-Half 2026 Tax Revenue
Indonesia’s tax revenue posted strong growth in the first half of 2026, with Minister of Finance Purbaya Yudhi Sadewa attributing the improvement to sweeping reforms within the Directorate General of Taxes (DGT). The reforms cover improvements to tax administration, organizational processes, human resource management, and the introduction of a performance-based reward and accountability system (carrot and stick) designed to improve the effectiveness of tax officials.
"We recognized that there were several inefficiencies in tax administration last year. That’s why we have been overhauling administrative processes, improving employee work methods and promotion systems, and introducing the carrot and stick approach to enhance tax administration,” Purbaya said during a working meeting with Commission XI of the House of Representatives in Jakarta on Wednesday (July 15, 2026)."
According to Ministry of Finance Data, tax revenue reached IDR 1,035.7 trillion during the first half of 2026, equivalent to 43.9% of the full-year state budget target of IDR 2,357.7 trillion. The figure represents a 24.6% year-on-year increase.
Purbaya said the strong performance demonstrates that the government’s tax reform agenda is beginning to deliver tangible results after experiencing operational challenges last year.
"Tax revenue grew by around 24% year-on-year in the first half of 2026. This reflects significant progress in addressing the weaknesses we encountered last year,” he said.
Government to Continue DGT Reforms
Despite the encouraging performance, Purbaya stressed that the reform process is far from complete. The government will continue strengthening the DGT by improving human resources quality, enhancing IT systems, and refining performance-based incentive and accountability schemes.
These measures are expected to support the government’s efforts to achieve the 2026 tax revenue target of IDR 2,357.7 trillion.
"We will continue these improvements sustainably. Our approach is systematic, covering stronger IT systems, better human resources quality, and an appropriate carrot-and-stick approach for tax officials," Purbaya said.
Nevertheless, the Ministry of Finance projects that tax revenue will reach IDR 2,310.8 trillion by the end of 2026, leaving a potential shortfall of IDR 46.9 trillion against the state budget target.
Fortifying Revenue Governance
Purbaya emphasized that tax reform, alongside efforts to optimize non-tax state revenue (penerimaan negara bukan pajak/PNBP), remains central to maintaining the country’s fiscal performance. The reforms focus on improving tax administration, increasing taxpayer compliance, expanding the use of digital technology, and reinforcing data-based supervision.
"The Ministry of Finance remains committed to strengthening state revenue governance through sustainable, transparent, and accountable reforms. Strong state revenue is essential to supporting development, improving public welfare, and maintaining national economic stability," he said.
Beyond tax administration, the government is also reforming PNBP by improving the management of natural resources and state assets to maximize their economic value.
According to Purbaya, Indonesia faced multiple external headwinds throughout 2025, including slowing global trade, moderating commodity prices, and increasing global economic fragmentation. Despite these challenges, the government continues to optimize state revenue while preserving a healthy investment climate and supporting economic growth.
Total state revenue reached IDR 2,765.1 trillion in 2025. Meanwhile, based on the 2025 Ministry of Finance Financial Report, revenue managed directly by the Ministry of Finance amounted to IDR 2,271.53 trillion. Growth in international trade revenue and PNBP supports this achievement, which increased by 6.43% and 9.77%, respectively, compared to the previous year.
Purbaya added that strengthening state revenue is not simply about collecting more taxes. Instead, fiscal policy must strike a balance between meeting government financing needs and maintaining a sustainable business environment. He emphasized that tax policy is being designed with care and precision to support the investment climate and continuously increase national economic competitiveness.
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