Indonesia has updated its cryptocurrency taxation policies through two new regulations issued by the Ministry of Finance. The changes affect various tax rates and will take effect on August 1.
Changes in Cryptocurrency Taxes
The income tax on crypto asset sales through domestic exchanges has increased from 0.1% to 0.21%. Taxes on foreign exchange transactions have jumped from 0.2% to 1%. Finance Minister Sri Mulyani Indrawati stated that the changes aim to provide legal certainty and adapt to developments in crypto trading.
Impact on Market Activity
The most significant tax increases have affected crypto miners. VAT rates for mining operations doubled from 1.1% to 2.2%, and the special 0.1% income tax rate for miners will be removed starting in 2026. The ministry also eliminated VAT on cryptocurrency purchases, which is expected to enhance retail investor participation.
Comparison with Neighboring Countries
While Indonesia increases taxes, neighbors such as Singapore and Malaysia maintain more favorable tax regimes. For instance, Singapore has no capital gains tax on crypto investments, while Malaysia offers tax exemptions for individual investors.
The changes in taxation policy reflect the growing activity in the cryptocurrency market in Indonesia and the need to balance government financial needs with regional competitiveness. Continuing this strategy may influence trading patterns and the distribution of crypto assets in Southeast Asia.
