- Indonesia hikes crypto seller taxes, favors domestic platforms over foreign ones.
- VAT removed for buyers, offering slight relief amid rising seller tax burden.
- Crypto mining faces higher VAT, income tax to replace special levy by 2026.
Starting August 1, Indonesia will enforce new tax regulations on cryptocurrency transactions, marking a significant policy shift. The updated framework increases tax rates for sellers on both domestic and overseas exchanges. Meanwhile, value-added tax (VAT) for buyers will be scrapped entirely.
As digital assets continue gaining popularity across the country, authorities are now placing stronger financial controls on the sector. This move aligns with the government’s broader goal of reclassifying crypto assets as financial instruments rather than commodities. With more than 20 million crypto users and a transaction value of over 650 trillion rupiah in 2024, this industry is now too large to ignore.
Tax Rates Differ Based on Platform Location
According to Reuters, under the new policy, the government will impose a 0.21% tax on crypto sellers using local platforms. This is a jump from the previous 0.1% rate. For sellers on overseas exchanges, the tax will increase even more dramatically from 0.2% to 1%.
Authorities are signaling a clear preference for domestic trading platforms over foreign ones. This adjustment is likely aimed at encouraging local participation and improving regulatory oversight.
Additionally, the VAT on crypto transactions, previously charged at 0.11% to 0.22% to buyers, will be removed. This change may offer some relief for retail investors, making domestic transactions slightly more appealing. However, the overall tax burden for sellers has increased significantly.
Crypto Mining Sees a Sharper Tax Climb
Crypto mining operations will also face tighter tax regulations. The VAT on mining will double from 1.1% to 2.2%. Furthermore, the current 0.1% special income tax on mining profits will be phased out by 2026.
From that point on, miners will need to pay standard personal or corporate income taxes based on their earnings. This shift places crypto mining under the same financial scrutiny as other income-generating activities.
Industry Calls for Adjustments and Support
Crypto exchanges like Tokocrypto have expressed support for the government’s regulatory clarity. However, they are urging officials to introduce a transition period.
Industry players believe at least a month is needed to fully implement these changes. They are also requesting fiscal incentives to help offset the higher tax rate, especially when compared to stock market investments.
