September 2, 2025 | 10:49 am
TEMPO.CO, Jakarta - Wahyudi Askar, Director of Public Policy at the Center of Economic and Law Studies (Celios Media), revealed that the Indonesian government has been paying the income taxes of council members and state officials.
Askar stated that the state's obligation to pay income tax on officials has been in place for more than ten years. This regulation is stipulated in Government Regulation Number 80 of 2010 concerning the Withholding Rate and Imposition of Article 21 Income Tax, which is charged to the State Budget (APBN) and Regional Budgets (APBD).
"In other countries, it's more egalitarian; everyone is treated equally, both citizens and state officials," Askar said when contacted by Tempo on Monday, August 25, 2025.
Askar believes the government needs to revise Government Regulation Number 80 of 2010 to create fiscal justice. In addition to easing the burden on the state budget, officials earning tens to hundreds of millions of rupiah per month should be able to pay income tax without state assistance.
"In Indonesia, state officials don't pay full taxes because the government provides facilities where the state pays their income tax. This is different from ordinary private sector employees, who, even with small salaries, are still required to pay income tax," he said.
According to Askar, the policy in Indonesia differs significantly from the practice in many developed countries, where state officials continue to pay their own income tax without government subsidies.
Income Tax Rates in Various Countries
Personal income tax (PPh) is a source of state revenue. In Indonesia, this levy is regulated by Law Number 36 of 2008 concerning the Fourth Amendment to Law Number 7 of 1983 concerning Income Tax.
This regulation requires deductions from personal income, whether from salaries, wages, allowances, honorariums, or other payments such as bonuses and bonuses. Deductions are made by employers, government treasurers, pension funds, and event organizers. Not only permanent employees, but also daily workers, artists, doctors, lawyers, and even accountants are subject to levies through the parties that pay their honorariums.
According to the Directorate General of Taxes website, the amount of withholding depends on the taxpayer's status. For permanent employees and retirees, the levy is taken from gross income after deducting office expenses, pension contributions, or Non-Taxable Income (PTKP).
Meanwhile, for non-permanent employees, the withholding is based on the Minister of Finance's regulations. The rate follows the Income Tax Law, with an additional 20 percent increase for those without a Taxpayer Identification Number (NPWP). The government divides the rates into five tiers, starting at 5 percent for income up to Rp60 million per year, to a maximum rate of 35 percent for those earning more than Rp5 billion.
So, what are the income tax rates in other countries? According to Trading Economics, here is a list of the 10 countries with the highest and lowest income tax rates.
10 Countries with the Highest Income Taxes:
1. Finland (57.65%)
2. Denmark (55.9%)
3. Japan (55.95%)
4. Austria (55%)
5. Sweden (52%)
6. Aruba (52%)
7. Belgium (50%)
8. Israel (50%)
9. Slovenia (50%)
10. Netherlands (49.5%)
10 Countries with the Lowest Income Taxes:
1. Guatemala (7%)
2. Bosnia & Herzegovina (10%)
3. Bulgaria (10%)
4. Kazakhstan (10%)
5. Kosovo (10%)
6. Libya (10%)
7. Macedonia (10%)
8. Romania (10%)
9. Serbia (10%)
10. Macau (12%)
Editor's Choice: DPR Members' Taxes Covered by Government, Celios: Unfair for Citizens
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