The international tax landscape has shifted with the enforcement of the Global Anti-Base Erosion (GloBE) Rules, commonly known as the global minimum tax (GMT). Initiated by the OECD/G20 Inclusive Framework on Base Erosion and Profit Shifting (BEPS), it aims to curb the corporate tax "race to the bottom" and discourage profit shifting to low- or tax-free jurisdictions.
In Indonesia, the policy was enacted under Minister of Finance Regulation (Peraturan Menteri Keuangan/PMK) Number 136 of 2024, effective since January 1, 2025. Director General of Taxes Bimo Wijayanto subsequently issued implementing provisions under Director General of Taxes Regulation Number PER-6/PJ/2026 on May 4, 2026.
The GMT applies to multinational enterprise (MNE) groups generating consolidated gross turnover of at least EUR 750 million (roughly IDR 15.5 trillion) in at least two of the preceding four fiscal years. These groups are subject to a minimum effective tax rate (ETR) of 15% across all operating jurisdictions.
The Directorate General of Taxes (DGT) projects that the policy could generate up to IDR 4.49 trillion in additional state revenue. It expects the income inclusion rule (IIR) to drive the largest contribution at IDR 4.41 trillion, while the qualified domestic minimum top-up tax (QDMTT) brings in IDR 86.38 billion.
Beyond revenue, GloBE introduces sweeping shifts to Indonesia's compliance landscape, altering reporting, penalties, and the treatment of tax holiday benefits for foreign investment (penanaman modal asing/PMA) companies.
DGT’s Oversight Framework
PER-6/PJ/2026 equips the DGT with statutory authority to monitor taxpayers that have registered for GloBE status, as well as qualifying taxpayers that meet the EUR 750 million threshold but have failed to register.
Oversight relies on data analytics through the Coretax system. Coretax processes and tracks corporate structures to support risk-based monitoring. Integrated electronic working papers also enable every stage of oversight, from account representative (AR) reviews to formal audits, to remain traceable.
Under Article 23 of PER-6/PJ/2026, the DGT can deploy several oversight instruments, which include requests for written explanations, demands for transfer pricing documentation, requests for MNE group consolidated financial statements, on-site visits, and taxpayer meetings for further discussion.
Through this mechanism, GloBE oversight moves beyond checking box-by-box reporting compliance to analyzing MNE groups’ data and compliance across jurisdictions.
Ex Officio Status Assignment
One of the initial requirements under GloBE is assigning status. Taxpayers belonging to an in-scope MNE group must register their GloBE status via the taxpayer portal within nine months of their first GloBE fiscal year-end. For instance, an entity whose GloBE fiscal year ends on December 31, 2025, must complete registration by September 2026.
If a taxpayer fails to register, Article 4(7) of PER-6/PJ/2026 empowers the head of the relevant tax office to assign GloBE status ex officio. The determination draws on DGT’s administrative review by means of data expansion, global information exchanges, and Coretax analytics.
An ex officio status assignment immediately subjects the taxpayer to GloBE reporting requirements. If an entity’s internal accounting cannot reconcile its financial statement with ultimate parent entity data in another jurisdiction, the resulting discrepancies may trigger a tax audit under Article 24 of PER-6/PJ/2026.
Reporting Obligations
GloBE introduces multiple tax returns alongside the standard corporate income tax return. Taxpayers within the scope of GloBE may be required to file three additional types of tax returns, i.e., the GloBE income tax return for ultimate parent entities, DMTT income tax return for Indonesian GloBE entities, and UTPR income tax return where UTPR top-up tax allocations apply.
Moreover, taxpayers must submit a GloBE Information Return (GIR) in XML format alongside a notification document. The GIR details group operational structures, jurisdiction-by-jurisdiction ETR calculations, and top-up tax allocations. These data may be automatically shared with treaty-partner jurisdictions with a qualifying competent authority agreement.
Penalties for GloBE Non-Compliance
Non-compliance regarding GloBE, DMTT, and UTPR tax return filings triggers administrative penalties under Law of the Republic of Indonesia Number 6 of 1983 concerning General Provisions and Procedures of Taxation (KUP Law). Article 66 of PMK Number 136 of 2024 stipulates that administrative violations relating to tax return filing and payment of top-up tax are subject to the penalties governed by the KUP Law.
Accordingly, late filing of a GloBE tax return carries a fine similar to that applicable to a corporate income tax return. Penalties may become more severe where the violation goes beyond an administrative delay and involves inaccurate or manipulated data. The KUP Law distinguishes between violations arising from negligence and those committed intentionally.
- Negligence (Article 38 of KUP Law)
Taxpayers who unintentionally fail to file tax returns, or submit incorrect or incomplete tax returns that cause state revenue loss, face up to one year of imprisonment and/or fines equal to 1 (one) to 2 (two) times the amount of tax unpaid or underpaid. - Intentional Non-Compliance (Article 39 of KUP Law)
Taxpayers who deliberately fail to register, fail to file tax returns, or file incorrect or incomplete tax returns may be subject to criminal penalties. Under the GloBE regime, this could include manipulating ETR calculations or cross-border profit allocations in the GIR to avoid top-up tax. Article 39 of the KUP Law provides for imprisonment of up to six years and a fine equal to 2 (two) to 4 (four) times the amount of tax unpaid or underpaid.
The ultimum remedium principle governs the enforcement of tax violations. Under Article 8(3) of the KUP Law and Government Regulation Number 50 of 2022, taxpayers undergoing a preliminary evidence audit may voluntarily disclose violations.
Taxpayers may voluntarily disclose violations through this scheme, settle outstanding tax liabilities, and pay a 100% fine to avoid criminal prosecution. Conversely, if they do not take the opportunity and the matter proceeds to a criminal investigation, taxpayers may be subject to heavier penalties. Fines for intentional violations under Article 39 of KUP Law can jump to 300%.
Transitional Penalty Relief Period
PMK Number 136 of 2024 provides relief from certain administrative tax penalties during the GloBE implementation transition period. This rule is set out in Article 70 of PMK Number 136 of 2024.
Reporting constituent entities are exempt from specific GloBE-related administrative tax penalties for fiscal years beginning before December 31, 2026, and covering periods ending on or before June 30, 2028.
The policy is consistent with the OECD’s reasonable measures approach. Penalty relief is available as long as taxpayers demonstrate good faith in fulfilling their GloBE obligations.
The relief applies only to administrative penalties. It does not eliminate the possibility of criminal sanctions where intentional violations are established. Consequently, transitional penalty relief cannot be used to avoid the criminal provisions under Article 39 of KUP Law where data manipulation or tax evasion is committed deliberately.
GMT Impact on PMA Incentives
The GMT fundamentally shifts the economics of traditional tax incentives available to PMA companies. Historically, Indonesia relied on various incentives, such as tax holidays and tax allowances, to attract foreign direct investment. Under GloBE, however, the benefits of some of these incentives may be reduced for MNE groups that meet the EUR 750 million threshold.
For example, if Indonesia grants a tax holiday that reduces a PMA’s corporate income tax rate to 0%, its ETR in Indonesia could fall below the 15% minimum. The difference may then be collected through a top-up tax mechanism.
If Indonesia does not collect the top-up tax through a QDMTT, the top-up tax may instead be collected by the jurisdiction of the ultimate parent entity under the IIR. As a result, some of the economic benefit of the tax incentive granted by Indonesia could shift to another jurisdiction through tax collection.
The condition also affects how PMA companies’ investments are evaluated. For MNE groups meeting the EUR 750 million threshold, the minimum 15% ETR must still be met. The resulting top-up tax may be paid in Indonesia through the DMTT or, under certain circumstances, in another jurisdiction through the GloBE mechanism.
Therefore, tax holidays may no longer guarantee the same level of benefit to MNE groups within the scope of GloBE as they did before the GMT took effect. The effectiveness of an incentive needs to be assessed not only based on Indonesia’s tax rate, but also on its impact on the group’s overall top-up tax liability.
Legal Basis
- Minister of Finance Regulation Number 136 of 2024 concerning the Implementation of the Global Minimum Tax Under International Agreements.
- Director General of Taxes Regulation Number PER-6/PJ/2026 concerning Procedures for Exercising Global Minimum Tax Rights and Obligations Under International Agreements.
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