Regulation Update
The Provisions are Revised, Pandemic-Affected Incentives Slashed

Thursday, 03 February 2022

The Provisions are Revised, Pandemic-Affected Incentives Slashed

The provision of incentives for taxpayers affected by the Covid-19 pandemic has begun to be limited. In fact, starting in 2022, the government will stop providing some incentives. Some of them are incentives for Income Tax Article (ITA) 21 borne by the government and final income tax borne by the government.

This is stated in the Minister of Finance Regulation (PMK) Number 3/PMK.03/2022 which was released on 25 January 2022.

The regulation revokes the previous provision, namely PMK Number 9/PMK.03/2021 which was last amended by PMK Number 149/PMK.03/2021.

With the termination, the government asks taxpayers who have used both facilities until the end of December 2021, to immediately submit a realization report, not more than 31 March 2021.

Recipient Coverage are Narrowed

For several other incentives, although the validity period was extended until June 2022, the government cut the coverage of taxpayers who were entitled to receive it.

There are three types of incentives whose validity period is extended, namely:

  • Exemption from ITA 22 on imports
  • Reduction of ITA 25 installments up to 50% of the income tax payable
  • The final income tax incentive for construction services is given to income recipients from the construction service business on the Acceleration Program for Irrigation Water Use Improvement (P3-TGAI).

For the exemption of ITA 22 on imports, the government cut the Business Classification (KLU) entitled to receive it, from 397 KLU to only 72 KLU.

Meanwhile, for KLU recipients of the ITA 25 installment reduction facility, it was cut from 481 KLU to 156 KLU.


Taxpayers who are included to the KLU of the recipient of the facility can take advantage of the exemption of ITA 22 on imports by applying for a free certificate (SKB) to the Directorate General of Taxes (DGT).

Meanwhile, taxpayers who want to get a reduction in ITA 25 installments can submit a notification to the DGT via

For taxpayers who have previously used these two facilities, they must submit an application for SKB and notification back to the DGT and submit a realization report.

Already Reported Annual Tax Return

In addition, to take advantage of the ITA 22 on import and ITA 25 facilities, taxpayers must also submit an Annual Income Tax Return (SPT) for 2020 first.

Except, for taxpayers who have not or do not have the obligation to submit an Annual Income Tax Return.

Fiscal Capacity

In its consideration, the limitation on the provision of tax facilities is because the government must adjust it to its fiscal capacity.

However, the government admits that incentives are still needed to accelerate the recovery of the national economy, which is still in a pandemic condition.


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