Ministry of Finance Extends Government-Borne VAT Incentive Until 2027

The government has finalized the policy to extend Government-Borne (Ditanggung Pemerintah – “DTP”) Value Added Tax (“VAT”) incentive for the purchase of landed houses and multistory housing units (“Sarusun”) applicable for Fiscal Year 2026. The requirements to qualify for the DTP VAT incentive remain the same: for house purchases with a maximum price of Rp 5 billion, the DTP VAT coverage is Rp 2 billion.

“Currently, the draft Regulation is still in the formulation process, where the DTP VAT incentive will continue to be provided at 100% of the payable VAT and will apply to the handover occurring from 1 January 2026 to 31 December 2026,” said Tio Serepina Siahaan, Head of the Legal Bureau of the Ministry of Finance (“Kemenkeu”), to Hukumonline.

Although the conditions for the granting of incentive remain the same, Kemenkeu has added additional requirements that must be fulfilled at the time the property is handed over. Both new landed houses and Sarusun units must be in move-in ready condition. The actual handover of the unit must also be documented with a Minutes of Handover (“BAST”), which must be signed and registered by the selling Taxable Entrepreneur (PKP) in the relevant ministry’s apps by no later than the end of the following month after the month of the handover.

“VAT will not be borne by the government if the handover occurs before 1 January 2026, or after 31 December 2026, or if a down payment or the first installment has been made before 1 January 2026,” she explained.