The Just Tax Forum welcomes the President of Indonesia’s admission in the 2027 KEM PPKF speech, but emphasizes that economic consolidation without oversight reform risks deepening the leakage, rather than closing it.
Jakarta — The Indonesian Government has, for the first time, officially acknowledged the scale of state losses due to export under-invoicing. In the introductory speech of the 2027 Macroeconomic Framework and Fiscal Policy Principles (KEM PPKF) before the House of Representatives (DPR) on May 20, 2026, the President of the Republic of Indonesia delivered an estimated leakage of USD 908 billion, equivalent to IDR 15,400 trillion, over the 1991–2024 period, referring to UN COMTRADE data processed by the NEXT Indonesia Institute. This figure is equivalent to more than four times the 2026 State Budget (APBN), or an average of IDR 450 trillion lost every year, which approaches a quarter of Indonesia’s total tax revenues today.
“This government estimate confirms a trend consistent with PRAKARSA’s research and international literature for over a decade. In PRAKARSA’s study on the fisheries and coal sectors alone, indications of trade mis-invoicing worth IDR 128.24 trillion were found in the fisheries sector and around IDR 1,796.95 trillion in the coal sector during 2012–2021. The potential loss in state revenue from these two sectors reaches around IDR 74 trillion. The question has now shifted: from whether the leakage is occurring, to how the government will close it,” said Victoria Fanggidae, Executive Director of The Prakarsa and Coordinator of the Indonesia Just Tax Forum. “It should also be noted that this USD 908 billion figure is likely still conservative as its scope only covers export under-invoicing, excluding import over-invoicing, transfer pricing manipulation, and cross-jurisdictional profit shifting.”
Governance is the Root of the Problem, Not Ownership
Mis-invoicing occurs at the transactional level, such as the manipulation of price, volume, quality, or HS code classification. Shifting export control from private actors to state entities does not automatically close this loophole. State-Owned Enterprises (SOEs) transacting with overseas affiliates face similar incentives and loopholes, and could potentially be even harder to monitor if their public accountability is weak. Centralizing exports without reforming the beneficial ownership transparency regime risks relocating opacity rather than eliminating it.
Presidential Regulation (Perpres) Number 13 of 2018 on the Application of the Principle of Recognizing Corporate Beneficial Ownership (BO) has been in place for nearly a decade, yet it remains stuck in administrative self-declaration. The 2024 Extractive Industries Transparency Initiative (EITI) Indonesia validation highlighted weak verification of BO data and the lack of mandatory identification for Politically Exposed Persons (PEPs)—two structural loopholes that allow transfer pricing practices and asset concealment to persist.
“This 34-year leakage persists not because of who is exporting, but due to weak data integration among Customs, the Directorate General of Taxes (DJP), and PPATK, as well as the minimal exchange of trade data across jurisdictions,” said Aryanto Nugroho, National Coordinator of Publish What You Pay (PWYP) Indonesia. “Without accelerating the revision of Perpres 13/2018 into a two-stage verification regime—including data integration with DJP, Customs, and PPATK, and applying BO transparency as a prerequisite for export licensing—centralization under SOEs will not stop the leakage, it will only swap the actors,” he added.
Four Demands from the Just Tax Forum
- First: Full publication of the methodology behind the USD 908 billion estimate so that it can be tested, replicated, and used as a basis for setting measurable revenue recovery targets in the 2027 State Budget (APBN).
- Second: Accelerating real-time data integration among Customs, DJP, PPATK, and Bank Indonesia, accompanied by capacity building for Customs based on risk profiling and expanding Indonesia’s participation in the automatic exchange of information for trade data.
- hird: Public accountability over any expansion of Danantara’s mandate within the strategic commodity trade chain, including periodic BPK audits, contract transparency, and parliamentary (DPR) oversight as prerequisites before authority is extended any further.
- Fourth: Revising the tax ratio target. The state revenue assumption of 11.82–12.40 percent of GDP in the 2027 KEM PPKF is too conservative for an administration that has just acknowledged a loss of IDR 15,400 trillion. An ambitious target is the ultimate test of political will.
“Fiscal policy is not tested by what is acknowledged on the podium, but by the reforms implemented on the ground,” concluded Siti Khoirun Ni’mah, Executive Director of INFID. “The Indonesia Just Tax Forum will monitor whether the IDR 15,400 trillion figure becomes a turning point for Indonesia’s fiscal reform or stops at being a narrative without action. Indonesia’s OECD accession process must be utilized concretely to strengthen transparency, cross-jurisdictional data exchange, and close tax avoidance loopholes, rather than merely being a symbolic agenda.”
The Indonesia Just Tax Forum is a coalition of civil society organizations promoting a fair, progressive, and transparent Indonesian tax system as an instrument of fiscal sovereignty and economic justice.
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