ABS (Automatic Blocking System)

The Automatic Blocking System (ABS) is the system used by Indonesia's Directorate General of Taxes (DGT) to automatically block the bank accounts of delinquent taxpayers as part of active collection actions. ABS is triggered after preceding collection steps fail, namely a warning letter (Surat Teguran, issued 7 days after the payment deadline) and a forced payment letter (Surat Paksa, issued 21 days after the warning letter). The collection authority rests in Law No. 19/2000 on Tax Collection by Forced Letter. Technical procedures are set out in MoF Regulation No. 61/2023, including the obligation for banks to hold funds equal to the tax debt plus collection costs (Articles 29-30 of MoF Reg. 61/2023). A block can be lifted when the taxpayer settles the debt, posts equivalent collateral, or obtains approval for an installment or postponement from the registered tax office (KPP). ABS is one of the DGT's eight action plans for tax law enforcement in 2026, intended to accelerate the recovery of outstanding tax receivables.

This article is for education, not tax advice.

Example

Example: PT X owes IDR 250 million in VAT, and the forced letter deadline has lapsed by more than 21 days. The DGT's ABS automatically issues blocking instructions to the banks where PT X holds accounts. The banks must hold an amount equal to the tax debt plus collection costs until PT X settles or the registered tax office issues another decision.

Source: Law 19/2000; MoF Reg. 61/2023