Maman made the statement to clarify public perceptions suggesting that the government taxes all business operators, including small traders.
“If there is a narrative that the government collects taxes from street vendors or ultra-micro businesses, that is a hoax. For turnover below Rp500 million per year, no tax is imposed at all,” Maman told ANTARA during an interview at the ANTARA Heritage Center in Pasar Baru, Jakarta, on Friday.
He explained that the government has set a final income tax rate of 0.5 percent for MSMEs with annual turnover of up to Rp4.8 billion. On average, this equals Rp400 million per month.
“Imagine, a business with Rp400 million in monthly turnover is only subject to around Rp18 million in tax per year. That is a form of government affirmation,” he said.
Related news: KKI 2025: MSME export deals hit Rp168.3 billion
The 0.5 percent final income tax policy was initially applied for seven years and was set to end in 2025. However, the government decided to extend the incentive until 2029 as part of the national economic stimulus program continued by President Prabowo Subianto.
To support the implementation of this policy, the government allocated Rp2 trillion in 2025, with registered MSME taxpayers reaching 542,000, according to data from the Directorate General of Taxes at the Ministry of Finance.
Maman stressed that the MSME tax policy is based on the principles of social justice and economic capacity.
“This is not about collecting, but about support. Taxes are only imposed on business operators whose turnover is already considered large,” he said.
He also urged the public to fully understand the policy and not be swayed by misleading narratives.
Based on Law No. 20 of 2008 on MSMEs, classification is determined by assets and annual turnover.
Micro enterprises are productive businesses owned by individuals or sole proprietorships with maximum assets of Rp50 million and annual turnover not exceeding Rp300 million.
Small enterprises are independent productive businesses, not subsidiaries or branches of medium or large enterprises, with assets of more than Rp50 million up to Rp500 million and annual turnover of more than Rp300 million up to Rp2.5 billion.
Medium enterprises are also independent businesses, not part of large enterprises, with assets of more than Rp500 million up to Rp10 billion and annual turnover of more than Rp2.5 billion up to Rp50 billion.
Related news: MSME ministry prepares app to support community businesses
Translator: Primayanti
Editor: Rahmad Nasution
Copyright © ANTARA 2025
