Although Indonesia’s investment trend continues to rise each year—reaching Rp1,434 trillion or 75% of the target by Q3-2025—the country’s tax ratio has actually declined. Deputy Minister of Investment Todotua Pasaribu noted that investment’s contribution to GDP has reached 26–30%, yet the tax ratio as of Q3-2025 stands at only 8.58%, far below the ideal target.
The decline in the tax ratio is driven by several factors. Many new investment projects are still in the development stage and enjoy fiscal incentives such as tax holidays. In addition, the dominance of capital-intensive and export-oriented sectors contributes minimally to domestic VAT and income tax. Analysts also highlight potential tax avoidance through phantom FDIschemes originating from low-tax jurisdictions such as the BVI and Cayman Islands, as well as weak digital tax collection.
—Kontan, 13 November 2025
BSI Institute Warns of Fiscal Risks from Surge in Tax-Haven Investment
BSI Institute warns that the surge in foreign investment into Indonesia—particularly from tax-haven countries such as Bermuda and the British Virgin Islands—may pose hidden fiscal risks. In its Quarterly Volume III 2025 report, the institute highlights the growing dominance of phantom FDI, investments recorded legally but not reflecting real economic activity, often facilitated through special purpose entities (SPEs).
Although such investments create jobs, their impact depends heavily on the sector being financed and does not always translate into real economic value. Additionally, transfer pricing practices, complex foreign ownership structures, and the use of intangible assets widen financial reporting gaps and reduce the effectiveness of fiscal oversight. BSI concludes that these phenomena partly explain why Indonesia’s tax ratio continues to decline despite rising FDI realization each year.
—Kontan, 12 November 2025
BI Projects 2026 Economic Growth at 5.3%, Slightly Below Government Target
Bank Indonesia projects Indonesia’s economic growth at 5.3% in 2026, slightly below the government’s 5.4% target stated in the state budget (APBN). Governor Perry Warjiyoexplained that the projection considers the global economic slowdown—including among Indonesia’s main trading partners—alongside expectations of a stable rupiah and potential interest-rate cuts to support growth.
BI remains optimistic that the government’s target of 5.4% is still achievable if fiscal stimulus is accelerated, particularly by front-loading government spending early in the year. BI’s projection also shows an improvement from the 2025 target of 5.1%, supported by synergy in monetary, macroprudential, and payment-system policies, as well as continued fiscal support.
—Kontan, 12 November 2025
OJK Launches 2025–2030 Pawnbroking Roadmap, Aims to Raise Gadai Loan Proportion
The Financial Services Authority (OJK) launched the 2025–2030 Pawnbroking Development and Strengthening Roadmap, targeting a step-by-step increase in the proportion of pawn-based loans: 82% in 2025–2026, 85% in 2027–2028, and 87% in 2029–2030. To achieve these targets, OJK urges pawn companies to focus on pawn products as their core strength, supported by improved governance, efficiency, digitalization, and financing for micro and ultra-micro segments.
The Indonesian Pawnbroking Association (PPGI) noted that optimal efforts are required—particularly improving workforce creativity and ensuring adequate capital. As of September 2025, the total pawnbroking industry financing stood at Rp111.68 trillion, of which 83.28%or Rp93 trillion was distributed through pawn products.
—Kontan, 15 November 2025
Presidential Regulation on National Logistics Strengthening Enters Finalization Stage—Focus on Infrastructure, Digitalization, and Human Capital
Coordinating Minister for Economic Affairs Airlangga Hartarto stated that the draft Presidential Regulation on National Logistics Strengthening has entered the finalization stage. The regulation aims to build an efficient, integrated, and competitive logistics system, focusing on strengthening infrastructure connectivity, digitalizing logistics services, and enhancing human-capital capacity and logistics-service capability.
The regulation will also include cross-ministerial action plans, including the Zero ODOLpolicy. Although previously targeted for release in October 2025, the regulation is expected to be issued soon to support the 2025–2029 RPJMN and reduce national logistics costs. Akbar Djohan, Chairman of ALFI, welcomed the acceleration of this long-awaited policy.
—Bisnis, 12 November 2025
OJK Pushes Consolidation of KBMI I Banks, Opens Opportunities for Strategic Mergers
The Financial Services Authority (OJK) is urging banks in the KBMI I category to conduct comprehensive evaluations of their performance and business structures, while opening opportunities for strategic consolidation to strengthen the resilience of Indonesia’s banking sector. This move follows OJK’s plan to reassess the KBMI I category, which is considered insufficiently adaptive to industry dynamics.
Through an official letter issued in late October 2025, OJK emphasized four key directives:
Banks such as Bank Sahabat Sampoerna and OK Bank have expressed readiness to follow this direction, preparing potential collaboration or strategic synergy options. OJK is also considering providing incentives for banks that undertake consolidation as part of efforts to strengthen capital structure and efficiency amid rapid digitalization and rising cyber risks.
—Bisnis, 13 November 2025