Regulation Watch · Tax Compliance · Indonesia, for taxpayers seeking correction, objection, reduction, cancellation or removal of qualifying central-tax and central land-and-building-tax assessments, bills or administrative penalties handled by the Directorate General of Taxes.
PMK 71 Opens Two-Year Tax Penalty Relief Route
PMK 71/2026 allows DJP to grant qualifying reductions or cancellations of administrative tax and land-and-building-tax penalties for applications filed within two years from 2 October 2026, while tightening the application and payment conditions.
- Published
- Established on 29 September and promulgated on 2 October 2026 in State Bulletin No. 691 of 2026.
- Effective
- 2 October 2026, the date of promulgation. Applications for certain objection or appeal penalties received before that date and still undecided continue under PMK 118/2024.
- Added to Watch
- 7 October 2026
Who is affected
Indonesian and foreign-invested companies, foreign and domestic directors, shareholders and individual taxpayers; property and business taxpayers with central PBB liabilities; tax advisers and attorneys; and finance teams managing assessments, tax bills, objections, seized assets or requests for penalty relief.
Practical impact
DJP may reduce or cancel qualifying administrative sanctions, or reduce central PBB administrative fines, for eligible applications filed within two years after PMK 71/2026 took effect. The relief is discretionary and not an automatic amnesty. The amended rules require the underlying unpaid or underpaid tax, PBB principal or principal difference forming the basis of the penalty to be paid before the request; generally require one written Indonesian-language application for each assessment or bill; require stated reasons and the taxpayer's calculation; and require filing before an auction request or transfer of seized assets. The regulation also clarifies eligible penalty documents, excludes specified penalties connected to objections and appeals, allows international exchange of information during objection research and gives a taxpayer that does not attend the objection discussion ten working days after the attendance notice is sent to submit a written response.
The Ministry of Finance established PMK 71/2026 on 29 September and promulgated it on 2 October 2026. It immediately amended PMK 118/2024 on tax corrections, objections, reductions, cancellations and penalty relief.
The most time-sensitive addition is Article 27A. To support the national economy, DJP may grant a reduction or cancellation of qualifying administrative tax sanctions, or a reduction of central PBB administrative fines, for applications filed within two years after the regulation took effect. The window therefore runs to 2 October 2028, but the regulation does not promise approval.
The amended Article 23 requires the tax or central PBB principal forming the basis of the penalty to be paid before the request. The application must generally be made in Indonesian, one application per assessment or bill, state the taxpayer's requested penalty amount and reasons, be signed by the taxpayer, representative or authorised attorney, and reach DJP before the relevant seized assets enter the specified auction or transfer stage.
Eligibility depends on the procedural history of the assessment or bill. The amended regulation also identifies categories of administrative and PBB penalties that may be considered and excludes specified penalties imposed under the objection and appeal provisions. A taxpayer should therefore complete a document-by-document eligibility analysis rather than treating every penalty as covered.
For objection proceedings, DJP may now use tax-information exchange with partner jurisdictions. The regulation also confirms the response timetable: a taxpayer that does not use the right to attend may submit a written response to the objection-research results within ten working days after the attendance notice is sent.
Applications for specified objection or appeal penalties that were received before 2 October 2026 and remained undecided on that date continue under PMK 118/2024. All new filings should use the amended conditions and updated official forms.
Required action
- Inventory every outstanding tax assessment, tax bill, central PBB assessment and central PBB bill carrying an administrative penalty, and separate the principal amount from the penalty before evaluating relief.
- Confirm that the document and procedural history meet the amended eligibility tests, including whether an objection, cancellation, reduction or other overlapping remedy is pending, withdrawn, rejected or not considered.
- Pay the underlying unpaid or underpaid tax, PBB principal or principal difference that forms the basis of the penalty before filing, and retain proof showing how each payment was allocated.
- Prepare one signed Indonesian-language application per assessment or bill, state the penalty amount according to the taxpayer, explain the grounds and attach the supporting calculation and evidence.
- File before the authority submits seized assets for auction or requests transfer of assets excluded from auction, and do not assume that considering an application halts collection unless the law expressly provides otherwise.
- Calendar 2 October 2028 as the outer date for the special two-year route and file earlier to allow time to correct a returned or incomplete application.
- For an active objection, answer document requests within the stated 15-working-day first period and 10-working-day second period, and submit any written response to the research results within ten working days after the attendance notice is sent if the taxpayer does not attend.