At a Glance
The Ministry of Finance has formally extended the 0.5% Final PPh facility for Indonesian micro, small, and medium enterprises (MSMEs) through a new PMK that takes effect in May 2026. The facility now runs until tax year 2027 for individual taxpayers meeting the gross-turnover threshold.
Key Provisions
The 0.5% final rate on gross turnover continues to apply to individual MSMEs with annual turnover not exceeding IDR 4.8 billion. The first IDR 500 million of turnover remains exempt from PPh.
Analysis
The extension provides certainty for MSMEs still recovering from softer consumer demand. For practitioners, it is a moment to remind MSME clients to keep tight monthly turnover records and to evaluate when graduating to standard rates becomes the better option.
Action
MSMEs should reconcile 2026 turnover, ensure monthly remittances are timely, and retain payment evidence to support the Annual SPT filing.