Indonesia’s New Tax Refund Regime: PMK-28/2026
On 1 May 2026, Indonesia enacted PMK-28/2026, which changes the Tata Cara Pengembalian Pendahuluan Kelebihan Pembayaran Pajak (procedures for early refund of overpaid taxes). (pajak.go.id) Key features:
- Automatic eligibility categories: compliant taxpayers with certain profiles—formal compliance, clean tax history, no previous criminal record in tax matters—can apply for refunds without full audits. (pajak.go.id)
- Specified timeframes: the regulation mandates timelines for processing, somewhat faster than the older system.
- Targeted scope: includes overpayment scenarios due to input VAT, luxury goods tax, or overwithheld taxes. The rule emphasizes low-risk taxpayers.
Actionable Compliance Tip: If you're in Indonesia and expect overpaid tax, ensure your filings are clean (no late returns, no past violations), because that determines whether you get to use the fast refund route.
Marketplace Withholding on Income Tax Article 22
Starting 1 August 2026, digital marketplaces in Indonesia (Tokopedia, Shopee, Lazada, Blibli) are required to withhold Income Tax Article 22 on sales by domestic merchants using their platforms. (pajak.go.id)
- What that means: Instead of each merchant doing self-remittance, the marketplace deducts the tax upfront per transaction.
- Why it matters: Simplifies compliance for small sellers, but requires awareness because amounts withheld reduce cash flow.
Enforcement & Administrative Tightening under UMKM Policies
Per PP 20/2026, the government redefined eligibility for final PPh 0.5% rates for UMKM, limiting it to individuals, single-person PTs, and cooperatives with turnover ≤ Rp 4.8 billion. Entities that previously benefited but now excluded must transition to the general corporate tax framework. (pajak.go.id)
- Firms with turnover near threshold need better forecasting to avoid unpleasant surprises.
- Keep clear books so that taxable income and turnover are verifiable.
Implications for Businesses & Best Practices
- Cash flow impact: With new marketplace withholding, plan for reduced net proceeds; sellers may need to pre-price considering the withheld amounts.
- Audit risk lower for compliant taxpayers: Under PMK-28/2026, lower risk of full audit for those with clean tax records who apply for refunds.
- Documentation is key: Maintain accurate invoices, proof of expenses, transaction records especially when transitioning from final tax regimes.
- Update contracts and invoices: Ensure marketplaces issue invoices reflecting withholding; ensure tax agents/bookkeepers are updated.
Example Compliance Workflow
A small creative agency on Shopee earns Rp 100 million/month (Rp 1.2 billion/year), under the Rp 4.8 billion threshold.
- Prior to August 2026: agency remitted their own PPh Article 22; after Aug 1, marketplace deducts it.
- When expecting VAT overpayments, ensure agency qualifies under PMK-28, submit early refund request with necessary supporting documents.
Conclusion
Indonesia’s recent tax compliance reforms—from expedited refunds to marketplace withholding—reflect broader moves in ASEAN to tighten enforcement while simplifying where possible. For businesses: stay current, keep clean tax records, and integrate compliance planning (not just reporting) into your operations.