Finance Minister Sri Mulyani Indrawati raise the tax rate for the rich. Income exceeding IDR 5 billion annually is subject to a tax rate of 35%, up from the previous 30% for income exceeding IDR 500 million annually.
This is stated in law number 7 of 2021 relating to the harmonization of tax regulations (HPP). The rules are then clarified in Government Regulation (PP) number 55 of 2022 relating to the adjustment of regulations in the income tax sector.
“Many netizens comment that they should be RICH AND OFFICIAL to pay taxes. I AGREE AND VERY TRUE…! Those who are rich and officials are actually subject to tax. Even for those who have salary above IDR 5 billion/year , they pay 35% tax (increase from previous 30%),” Sri Mulyani said in an upload to the official Instagram account @smindrawati on Tuesday (3/1/2023).
Sri Mulyani he explained that the wealthy with an income above IDR 5 billion a year could pay taxes of IDR 1.75 billion a year or IDR 145.83 million a month. Let’s calculate with the example case below.
For example, there is a director named Pak Pulan who has an income of IDR 6 billion/year or IDR 500 million/month being married, his wife is not working and he has 3 children. How much PPh 21 must be paid per year?
PPh per year for the rich
PKP – PTKP x 35%
IDR 6 billion – IDR 72 million x 35% = IDR 2.07 billion
So the total tax that Pak Pulan has to pay is IDR 2 billion/year or IDR 166.6 million/month.
“Those with limited ability and weak are tax exempt, and even assisted by various forms of social assistance, subsidies, health benefits, scholarships and more. Those who are strong and capable, pay taxes,” he said.
And the tax for low-income employees of the UMR? Check out the next page.
