Indonesia May Cut VAT Rate in 2026 to Boost Consumption

MACROECONOMY 
Indonesia May Cut VAT Rate in 2026 to Boost Consumption 
Finance Minister Purbaya Yudhi Sadewa signaled potential VAT reduction in 2026 to support household purchasing power, though the plan remains under review. Celios Executive Director Bhima Yudhistira suggested lowering the rate from 11% to 8%, estimating it could raise state revenue by IDR 1 tn through stronger consumption and higher income tax collections. UGM economist Kun Haribowo noted VAT contributes 38-40% of total tax revenue, emphasizing that any rate change will directly impact prices, consumption, and fiscal income. (Kontan) 

Indonesia's State Budget (APBN) Posted IDR 371.5 tn Deficit as of Sep-25 
Indonesia recorded an APBN deficit of IDR 371.5 tn (1.56% of GDP) as of 30-Sep-25, mainly due to lower global commodity prices pressuring oil, gas, and mining tax revenues. State revenue reached IDR 1,863.3 tn (65% of outlook) against spending of IDR 2,234.8 tn (63.4%). The Ministry of Finance is pursuing IDR 60 tn in tax arrears from 200 major taxpayers. (Emitennews) 

INDUSTRY 
China Vehicle Sales Rose 14.9% YoY to 3.23 mn Units in Sep-25 

China's total vehicle sales increased 14.9% YoY to 3.23 mn units in Sep-25 (vs Aug-25; +16.4%), marking a nine-month high, according to CAAM. New energy vehicle (NEV) sales surged 24.6% YoY to 1.60 mn units, representing 49.7% of total car sales and extending gains for a seventh straight month. For 9M25, total vehicle sales rose 12.9% YoY, while NEV sales jumped 34.9%. On a MoM basis, vehicle sales grew 12.9%, up from 10.1% in Aug-25. (Trading Economics)

COMPANY 
Ciputra Development (CTRA) Posted 12% YoY Decline in 9M25 Marketing Sales 
CTRA recorded marketing sales of IDR 7.6 tn in 9M25, (-12% YoY) amid softer housing demand in 3Q25. Landed residential remained dominant at 97% of total sales (-12% YoY), while apartment and office segments dropped 31% YoY. Greater Jakarta contributed 50% (+12% YoY), followed by Greater Surabaya at 22% (-18% YoY) and Sumatra at 10% (-58% YoY). FY25 sales target was cut to IDR 10 tn (from IDR 11 tn) amid cautious outlook. Mortgage remained main payment method (71%). Upcoming launches include Sicilia and Montegard Clusters in CitraCity Sentul and Hortis Cluster in CitraGarden Serpong. (Company) 

Pakuwon Jati (PWON) Posted 19.9% YoY Decline in 9M25 Marketing Sales 
PWON booked marketing sales of IDR 902.9 bn in 9M25 (-19.9% YoY), with 73% or IDR 661.7 bn supported by the govt.'s VAT incentive. Surabaya contributed IDR 681.9 bn (70% under VAT incentive), while Jakarta booked IDR 221.0 bn (82% under VAT incentive). Landed projects accounted for IDR 374.5 bn (84% under VAT incentive) and high-rise projects IDR 528.4 bn (66% under VAT incentive). (Company)