November 26, 2025 | 09:29 pm
TEMPO.CO, Jakarta - Indonesian Industry Minister Agus Gumiwang Kartasasmita admits that the government is still considering giving incentives for the automotive industry next year. Despite this, the minister acknowledges the importance due to the strategic nature of the industry.
"We are currently drafting the automotive incentives, which I believe is a necessity because it is a crucial sector," said Agus Gumiwang in Tangerang, Banten, on November 26, 2025.
He stated that in the New National Industrialization Strategy (SBIN), there is a backward linkage and forward linkage in the manufacturing industry. The automotive sector has the largest impact.
Therefore, he believed that the government should prepare incentives for the automotive sector in 2026. However, he stopped short of detailing the discussion about the planned stimulus.
On the other hand, Coordinating Minister for Economic Affairs Airlangga Hartarto believes that the national automotive industry is mature enough to forgo specific stimulus from the government. "There will be no incentives next year because the industry is already quite strong," he said at the same location.
But he also did not deny the chance for incentives next year. "Under consideration, but not yet decided," he said.
At the end of last year, the government announced a series of stimuli for the automotive industry. Among them is a value-added tax (VAT) incentive borne by the government for certain four-wheeled electric vehicles (EVs) and certain EV buses at 10 percent.
This incentive is given for vehicles with a minimum 40 percent domestic component level (TKDN) and a 5 percent incentive for certain EV bus deliveries with a TKDN of at least 20 percent up to less than 40 percent.
The Indonesian Automotive Manufacturers Association recorded retail sales or direct car sales to consumers from January to June 2025 amounted to only 390,467 units, a 9.7 percent drop compared to the same period in 2024 (year on year). Meanwhile, wholesale or distributor to dealer sales experienced an 8.6 percent decline from 410,020 units to 374,740 units.
Oyuk Ivani contributed to the writing of this article
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