Tax Revenue Surpasses Rp1,607 Trillion, Restitutions Drop 38%: Can the DJP Chase the Remaining Rp750 Trillion Target?

The Directorate General of Taxes (DJP) is preparing various steps to chase the remaining tax revenue target of Rp750.1 trillion in the fourth quarter of 2026. Up to the end of September, realized tax revenue reached Rp1,607.6 trillion, or 68.2% of the annual target of Rp2,357.7 trillion. To optimize revenue in the final three months of the year, the DJP will leverage tax data through supervision, audits, law enforcement, and the tapping of revenue potential across various business sectors.

The government is also strengthening tax collection from digital economic activities. The Tax Collection System for Foreign Digital Transactions (SPP-TDLN) began operating on September 25, 2026, supported by five banks and one fintech entity, while the 0.5% Article 22 Income Tax collection via marketplaces rolled out on October 1, 2026. The DJP is currently reconciling the realized revenues from these two instruments and plans to expand partnerships with payment service providers. Furthermore, the DJP is targeting revenue potential from the trade, manufacturing, mining, corporate services, transportation and warehousing, construction, and real estate sectors. This strategy aligns with the revenue trends by tax type, which show varying contributions from each revenue group.

Up to September 2026, Domestic VAT (PPN Dalam Negeri) recorded a realization of Rp369.5 trillion, growing 51.3% year-on-year and becoming the largest contributor among the individual tax types mentioned in the report. This growth was primarily driven by wholesale trade activities of fuel oil (BBM). Meanwhile, Non-Oil and Gas Income Tax (PPh Nonmigas) emerged as the largest revenue group with a realization of Rp809.3 trillion, growing by 17.6%. Total VAT and Luxury Goods Sales Tax (PPnBM) reached Rp683.3 trillion, increasing by 38.6% in line with robust domestic consumption. Corporate Income Tax (PPh Badan) also grew 29% with a realization of Rp276.7 trillion, primarily supported by sectors related to palm oil.

Revenue growth was also evident in several other tax types. Article 21 Income Tax (employee tax) reached Rp189.4 trillion, growing 19% year-on-year, while Personal Income Tax reached Rp19.2 trillion, growing 14.4%. Income increases and administrative improvements through Coretax supported the revenue of these two tax types, with prepopulated data features and the availability of more comprehensive withholding slips serving as supporting factors for Personal Income Tax. On the other hand, Import VAT reached Rp293.9 trillion, growing 28.1%, while Oil and Gas Income Tax (PPh Migas) reached Rp43.6 trillion, surging 128.2% alongside rising crude oil prices. However, these revenue developments must also be viewed alongside the tax overpayment refund policies, which affect the disbursement timeline of funds from the state treasury to taxpayers.

Tax restitution is a focal point because the government must maintain compliance while ensuring the fulfillment of taxpayers' rights. Through Minister of Finance Regulation (PMK) No. 28/2026, which took effect on May 1, 2026, the government regulates the procedures for preliminary refunds of tax overpayments with stricter criteria. By the end of September 2026, tax restitution disbursements were recorded at Rp198.71 trillion, down 38.08% compared to Rp320.91 trillion in the same period the previous year. This decline in realization occurred during the implementation period of the new policy, though this figure does not automatically prove that the regulatory change is the sole cause.

From the business sector's perspective, delays in restitution disbursements can disrupt liquidity and increase corporate financing needs. This condition is of particular concern to foreign investors, labor-intensive industries, and micro, small, and medium enterprises (MSMEs) that require working capital to maintain operational activities. The government subsequently directed the DJP to immediately process restitution rights for labor-intensive industries and MSMEs that need cash flow support. This directive must still be understood within the framework of fulfilling applicable tax requirements, rather than as a guarantee that all applications will be automatically approved or paid.

Business circles are also pushing for comprehensive improvements to the restitution mechanism. The proposals submitted include the establishment of clear Service Level Agreements (SLA), risk-based audits, process simplification through Coretax, and standardized implementation across all Tax Service Offices. Process certainty is deemed crucial so that taxpayers can better plan their cash flows without compromising the government's need to oversee compliance. Thus, discussions on restitution involve not only the timing of refunds but also the balance between securing state revenue and ensuring the continuity of economic activities.

For business actors, these developments underscore the importance of concurrently managing tax obligations and liquidity. Companies must ensure that transaction records, supporting evidence, and tax reporting are well-organized to comply with applicable regulations. Companies entitled to restitutions also need to factor in potential disbursement timelines in their working capital planning. Meanwhile, the strengthening of digital tax collection requires business actors to understand the withholding or collection mechanisms relevant to their transactions. On the government's side, increased revenue must go hand in hand with administrative certainty that allows taxpayers to fulfill their obligations while obtaining their rightful claims according to regulations.

Ultimately, achieving the 2026 tax revenue target requires the optimization of collection, data-driven supervision, and effective tax administration. The government needs to continue uncovering revenue potential from leading sectors and the digital economy, while ensuring that the restitution process is conducted transparently, consistently, and measurably. For the business world, compliance and documentation readiness must be prioritized so that administrative risks can be managed effectively. The balance between state revenue and the certainty of taxpayers' rights remains one of the critical factors in maintaining business confidence and supporting the sustainability of economic activity.