JAKARTA, thekabarnews.com—The Directorate General of Taxes (DJP) has introduced temporary relief of up to 100 percent on certain administrative tax penalties. This gives eligible taxpayers an opportunity to correct filings and settle outstanding principal liabilities.

The policy took effect on Oct. 8, under DJP Decision No. KEP-239/PJ/2026. It covers several categories of penalties arising from late tax returns, voluntary corrections and delayed payments. It also applies to certain penalties listed in tax assessment and collection notices.

The amount of relief depends on when taxpayers fulfill the relevant obligation. For late annual income tax returns covering tax years through 2025 and underpaid periodic returns covering periods through September 2026, the schedule is:

Oct. 8–Dec. 31, 2026: 100 percent relief
Jan. 1–March 31, 2027: 50 percent relief
April 1–June 30, 2027: 25 percent relief

A similar schedule applies when taxpayers voluntarily correct eligible underpaid returns and settle the resulting tax within the prescribed period. The decision also covers penalties for late payment of tax reported in eligible annual or periodic returns.

However, the reduction rates and deadlines may differ for penalties arising from tax assessments, collection notices, land and building tax obligations or examinations related to assets omitted from the voluntary disclosure program (PPS). Therefore, taxpayers should check the provisions that apply to their specific case.

The policy requires that the taxpayer pay the principal tax debt first in order to be eligible for relief from administrative penalties.

Finance Ministry Regulation No. 71/2026, which amended Regulation No. 118/2024, changed the payment mechanism. Now, tax payments first settle the principal debt rather than being divided proportionally between the principal and penalties.

“This adjustment allows taxpayer payments to be used first to settle the principal tax debt, giving taxpayers an opportunity to complete their principal obligations while using the administrative penalty reduction or removal facility under the applicable provisions,” DJP Director General Bimo Wijayanto said in an official statement.

Bimo stressed that the policy was not a tax amnesty and did not eliminate the obligation to pay outstanding principal tax.

Relief is not automatic. Eligible taxpayers must submit an application to the DJP no later than Oct. 1, 2028. The relief applies only to administrative penalties that remain unpaid.

Applicants must also submit a stamped statement declaring that the penalty resulted from an oversight or circumstances not attributable to their fault.

They may not pursue another lawsuit or legal remedy concerning the same matter. Taxpayers who have already initiated such action must withdraw it and provide evidence of the withdrawal.

Under the DJP’s general procedure, an application must be filed in Indonesian and explain the requested reduction and its grounds. The DJP may take up to six months to process a complete application.

The program offers its largest benefit to taxpayers who act before the end of 2026. Still, taxpayers should review their assessment or collection documents and consult the DJP before paying or applying. This is because the eligibility requirements differ across penalty categories.