Ministry Removes VAT on Crypto, But Raises Income Tax to 0.21% for Traders
Main Takeaways
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JAKARTA, Wednesday, July 30, 2025 — Indonesia’s Ministry of Finance has introduced sweeping changes to how cryptocurrencies are taxed, eliminating Value Added Tax (VAT) on crypto asset sales while raising income tax for traders to 0.21%. The change reflects the government's shift in treating cryptocurrencies from commodities to financial instruments.
The update is formalized in Minister of Finance Regulation (PMK) No. 50/2025, issued on Monday, July 28. The new policy, which takes effect on Friday, Aug. 1, 2025, removes the longstanding VAT requirement for crypto transactions and introduces a new tax structure aimed at aligning digital assets with traditional financial instruments.
According to the Directorate General of Taxes (DJP), the regulation seeks to provide legal clarity as oversight of the crypto sector has transitioned from the Commodity Futures Trading Regulatory Agency (Bappebti) to the Financial Services Authority (OJK), as stipulated in Government Regulation No. 49/2024.
“Previously, crypto was regulated as a commodity. Now that it's categorized as a financial instrument, the regulatory framework must be adjusted accordingly,” said Director General of Taxes Bimo Wijayanto at a press briefing in Jakarta on Tuesday, July 22.
VAT Eliminated for Crypto Sales, But Not for Services
Under PMK 50/2025, the sale or transfer of crypto assets is no longer subject to VAT. However, crypto-related services remain taxable. These include transaction facilitation, wallet services, and mining activities.
The regulation specifies that digital platforms (PPMSE) providing services such as fiat-to-crypto exchanges, crypto swaps, and wallet functions (including deposits, withdrawals, and transfers) will continue to incur VAT. The tax base is defined as 11/12 of the service fee or commission, taxed at the standard 12% rate.
Crypto mining services will face VAT calculated as 20% multiplied by 11/12 of the standard VAT rate, applied to the compensation (including block rewards) miners receive.
Detailed Tax Treatment
| Entity | VAT | Income Tax (PPh) | Effective Date |
|---|---|---|---|
| PAKD (Crypto Asset Sellers) | 0% | 0.21% flat | Aug. 1, 2025 |
| Crypto Miners | 2.2% | Based on Article 17 (progressive scale) | Jan. 1, 2026 |
| CPAKD (Crypto Exchange Reps) | 0% | Based on Article 17 | Aug. 1, 2025 |
| Foreign Crypto Exchanges | Not stated | 1% flat (if appointed or voluntary) | Aug. 1, 2025 |
These adjustments aim to differentiate between taxable services and asset ownership while preparing the regulatory landscape for broader financial integration of crypto instruments.
Toward a More Financially Integrated Crypto Ecosystem
Previously, crypto transactions were subject to VAT and income tax under PMK No. 63/PMK.03/2022, when digital assets were considered commodities. That regime generated Rp 1.21 trillion ($75 million) in crypto tax revenue during the first quarter of 2025 alone, indicating robust public engagement with digital assets.
Going forward, crypto’s new classification as a financial instrument may open the door to more complex tax applications, including on structured crypto investments, digital portfolio management, and crypto derivatives.
This could place crypto regulation closer in line with broader financial services, increasing both investor protection and revenue predictability.
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