Prabowo Targets Tax Revenue Ratio of 11.52% to 15% of GDP by 2029

JAKARTA, investortrust.id – President Prabowo Subianto has set an ambitious target for Indonesia's tax revenue ratio, aiming for a significant increase. According to the National Medium-Term Development Plan (RPJMN) 2025-2029 and Presidential Regulation No. 12 of 2025, the government seeks to raise the tax revenue-to-GDP ratio to between 11.52% and 15% by 2029.

“The tax revenue-to-GDP ratio is targeted at 10.24% in 2025 and will increase to 11.52%-15% by 2029,” stated the RPJMN document, as quoted on Thursday, Feb. 27, 2025.

Institutional Reforms to Boost Revenue

The 2025 State Budget (APBN) has set the tax revenue-to-GDP ratio at 10.24%. To achieve this expansion, the government plans to overhaul its institutional framework for national revenue collection.

A key initiative in this reform is the establishment of the National Revenue Agency (Badan Penerimaan Negara, BPN) within the next five years. The agency will spearhead efforts to optimize tax collection through four main interventions: implementing the Coretax system, simplifying business processes and institutional structures, improving tax administration for expansion and intensification, and enhancing tax compliance.

Beyond tax revenue, Prabowo is also targeting improvements in non-tax state revenue (PNBP). The government aims to reform governance while maintaining public service quality, increasing transparency and accountability, and boosting revenue from state-owned enterprises' (SOEs) dividends.

Taxpayer Compliance Targets

One of the key performance indicators for this initiative is expanding the taxpayer base through systematic outreach. By 2029, the government expects to achieve a 90% success rate in expanding the taxpayer database. Additionally, the compliance rate for annual tax return (SPT) filings—both for corporate and individual taxpayers—is set to reach 100% by 2029.

“The effectiveness index of national revenue policies is targeted to reach 100% by 2029,” the document states.

Declining Taxpayer Compliance in 2024

Investortrust.id data shows that tax compliance levels declined in 2024. According to Director General of Taxes Suryo Utomo, the total number of annual tax returns filed by the deadline reached 16.52 million.

Although this exceeded the formal target, it still fell short of the 19.27 million taxpayers required to file returns. Consequently, the formal compliance ratio for 2024 stood at 85.72%, surpassing the 2024 target of 83.22% but below the 86.97% compliance ratio recorded in 2023.