Cheaper Flights Ahead: Indonesia Cuts VAT on Economy Airfare in June-July 2025

• 

• English

Rabu, 11 Juni 2025 - 18:16 WIB

Jakarta, VIVA – Indonesian government is offering a series of stimulus measures in the second quarter of 2025 to maintain national economic growth at around 5 percent.

One of these measures is discounted airline tickets during the June–July 2025 period.

Coordinating Minister for Economic Affairs, Airlangga Hartarto, stated that the ticket discount is provided in the form of a Government-Borne Value Added Tax (VAT DTP) of 6 percent for economy class domestic flight tickets during June–July 2025.

The government has allocated a budget of IDR 430 billion for this program.

"Through this policy, a 6 percent VAT for domestic economy-class airline tickets will be borne by the government, with a total budget of IDR 430 billion," the minister said on Wednesday (June 11).

He added, "This means ticket prices paid by the public will be lower, as they will only pay 5 percent VAT instead of the usual 11 percent."

The incentive policy is outlined in the Minister of Finance Regulation (PMK) No. 36 of 2025, issued on June 4, 2025.

Minister Hartarto explained that the incentive applies to ticket purchases made from June 5 to July 31, 2025, for flights departing within the same period.

"The government is striving to keep national economic growth in the second quarter at around 5 percent and strengthen economic stability through various strategic measures," he added.

Minister Hartarto also stated that in a limited cabinet meeting led by President Prabowo Subianto on June 2, 2025, followed by a press briefing by the Finance Minister, Agriculture Minister, Social Affairs Minister, and Head of BPS, the government decided to launch five policy stimulus packages.

These packages include discounts on transportation, toll road tariff reductions, increased social assistance, wage subsidy support, and the extension of workplace accident insurance (JKK) contribution discounts.

“These incentives follow President Prabowo Subianto’s directives and reflect coordinated efforts across ministries and agencies to sustain economic momentum and reinforce economic stability,” he stated.

With this policy, minister Hartarto hopes to boost public mobility during the June–July 2025 period.

Increased public activity is expected to have a positive impact on the domestic transportation and tourism sectors.