Indonesia’s total tax revenue collected from digital economic activities is continuing on a growth trajectory spurred by a surge in cryptocurrency transactions. This comes as digital assets are gaining traction in the country, with more individuals turning to crypto to hedge volatility.
Figures from the Directorate General of Taxes (DJP) at the Ministry of Finance show a steady month-on-month growth in tax revenue contribution from the cryptocurrency industry in June.
Indonesia domestic investors show strong interest in crypto
According to the DJP, the crypto sector recorded Rp798.84 billion or $49 million between May and June. This amount represents 3% of the total tax that was collected from digital economic activities in the country, which amounted to Rp25.88 trillion.
According to Indonesia Business Post, the increase in crypto industry revenue is reflective of the strong interest from the domestic market.
The DJP has revealed a rapid increase in crypto tax receipts early this year. The first quarter of 2024 as first quarter alone recorded tax collection of Rp112.93 billion, which came from the crypto market alone.
The Indonesia government imposed taxes on crypto assets in 2022 through the Ministry of Finance in a regulation that stipulates an income tax rate of 0.1% on the transaction value for sellers of crypto assets and a value-added tax (PPN) rate of o.1% on the transaction value for buyers of crypto assets.
The user base and total value of transactions keep growing
Since May 1, 2022, the government has imposed taxes on crypto assets through Minister of Finance Regulation No. 68/PMK.03/2022. This regulation stipulates an income tax (PPh) rate of 0.1 percent on the transaction value for sellers of crypto assets and a value-added tax (PPN) rate of 0.11 percent on the transaction value for buyers of crypto assets.
However, physical crypto assets traders who are not registered with the Commodity Futures Trading Regulatory Agency (Bappebti) pay more as the tax rates are higher at 0,2% per PPh and 0,22% for PPN. According to Indonesia Business Post, the jump in tax revenue corresponds with the increase in crypto transactions in the country.
Bappebti revealed that the total value of crypto transactions amounted to Rp301.75 trillion during the first half of this year. This represents a year-on-year increase of 354.17% compared to Rp66.44 trillion recorded in the prior year.
The number of registered crypto asset customers reached 20.24 million by June 2024. The figure is expected to reach 28 million users by end of 2025, according to Statista.
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