Gov’t to Continue Ongoing Employment, Economic Incentive Programs in 2027

In 2027, the Government will sustain its internship and vocational programs and tax incentives while developing new economic incentives.

Coordinating Minister for Economic Affairs Airlangga Hartarto made the statement after a meeting led by President Prabowo at the Presidential Palace Complex in Jakarta on Wednesday (09/30).

“The President gave directives on programs set to launch in 2027. The programs that have been implemented this year will continue in 2027,” he said.

In the employment sector, the Government will continue the Ministry of Manpower’s internship program targeting 150,000 participants and the vocational program targeting 300,000 participants.

The Income Tax Article 21 reduction for workers earning less than Rp10 million will remain in effect. This year, it specifically covers workers in the labor-intensive and tourism sectors, but next year it will extend to all sectors.

“It will continue next year, and it will be provided to approximately 7.5 million workers. While it benefits the labor-intensive and tourism sectors now, it will be provided to all sectors next year, provided that the salary is under Rp10 million,” Airlangga said.

Airlangga pointed out that the Government is also adjusting the non-taxable income bracket by taking into account the inflation rate, adding that the Minister of Finance is currently discussing the calculation.

Meanwhile, the Government-Borne VAT on home purchases will remain effective next year. This benefit applies to houses priced up to 2 billion, and to those costing up to 5 billion with the Rp2 billion price as the basic incentive.

The Government is also finalizing the continuity of workers’ protection programs, including discounts on contribution fees for Work Accident Insurance (JKK) and Life Insurance (JKM), as well as a six-month extension of the Unemployment Insurance (JKP) benefit. Benefit amounts will vary by salary bracket and are under review by the Ministry of Finance.

In addition to ongoing programs, the Government is preparing a new subsidized mortgage loan for those with a fixed income of around Rp17 million. This scheme provides home ownership credit at a 6 percent interest rate for houses priced up to Rp500 million.

“Previously, this program was prepared for those who work as entrepreneurs, or those who have no stable income but have a business. Now, it is for those with a fixed income, and it applies to houses priced up to Rp500 million,” he said.

The Government is also preparing regulatory adjustments for the jewelry industry, especially concerning gold content standards that can benefit from the VAT facility. The currently applicable standard of 99.99 percent purity rate will be adjusted to 99.9 percent with an amendment to the relevant government regulation.

Airlangga further stated that the Government will prepare various technical regulations in the last quarter of 2026 so the programs can be announced and implemented shortly, adding that the budgets for all programs are under the Minister of Finance’s review.

“The budget is under review by the Minister of Finance. It is around Rp31 trillion,” he said. (BPMI of Presidential Secretariat) (DH/MMB)