In 2026, the Finance Minister will not charge PPh 21 to workers who earn up to Rp10 million

Jakarta, Thekabarnews.com—Starting in 2026, Finance Minister Purbaya Yudhi Sadewa set a policy. Workers with earnings up to Rp 10 million per month would not have to pay income tax (PPh) Article 21. The government made this decision as part of its attempts to keep the economy and society stable. It aims to keep people’s buying power high.

The Finance Minister Regulation (PMK) No. 105 of 2025 writes about these rules. It is in the context of the 2026 Fiscal Year Economic Stimulus. The rule is about the Income Tax (PPh) Article 21, borne by the government (DTP). The tax break is beneficial for the tax year running from January to December 2026.

The rule says that the government is putting together an economic stimulus package. This aims to keep the public’s standard of life up by providing fiscal facilities. According to the PMK’s considerations, as reported by Detik on Sunday, January 4, 2026, the government established an economic stimulus package to maintain the public’s standard of living, including by providing fiscal facilities.

The government pays for this PPh 21 government-borne value-added tax (PPN DTP) for workers in five economic sectors. These include footwear, textiles and clothing, furniture, leather and leather goods, and tourism. Some regular employees and some temporary or freelance workers can use these facilities.

For permanent employees, the incentive is only available if they have a Taxpayer Identifications Number (NPWP). Alternatively, an Identity Card Number (NIK) linked to the Directorate General of Taxes system is accepted. Furthermore, employees must receive a fixed and regular gross income. It must not go over Rp 10 million per month.

For freelancers or non-permanent employees, the incentive applies if they make an average of no more than Rp 500,000 per day or Rp 10 million per month. Previously, both permanent and non-permanent employees did not receive PPh 21 DTP benefits.

The PMK further states that the income of employees who get PPh 21 DTP incentives is not included in the area of revenue already taxed under different tax rules.

This regulation still allows for the administrative deduction of taxes from the pay of qualifying workers. However, the company pays these taxes back in cash, so they do not lower the workers’ net income.

The government believes this program will help keep household spending up. It also aims to provide workers more buying power. Ultimately, it intends to speed up the recovery of the national economy until 2026.