Indonesia continues to strengthen its supervision of companies, including Foreign...

June 4, 2026

0.5% Tax for PT PMA in Indonesia: What Foreign Investors Need to Know

Starting a PT PMA (Foreign-Owned Company) in Indonesia, especially in Bali, is becoming increasingly attractive for international entrepreneurs. One of the key benefits introduced by the Indonesian government is the 0.5% final tax rate for small businesses, which also applies to PT PMA under specific conditions.

What is PT PMA?

A PT PMA (Perseroan Terbatas Penanaman Modal Asing) is a legal entity that allows foreign investors to operate businesses in Indonesia. For anyone who wants to set up company in Bali as foreigner, this is the most reliable structure. It provides 100% foreign ownership in certain sectors and ensures legal protection for your business activities.

Understanding the 0.5% Tax Policy

The 0.5% final income tax is regulated under Government Regulation (PP) No. 23 of 2018. This tax is applied to companies with annual revenue of up to IDR 4.8 billion (approximately USD 300,000). For PT PMA, this means:

Your business only pays 0.5% of total revenue (not profit).
The reduced tax rate applies for a maximum of 3 years for PT PMA entities.
After this period, the company must switch to the normal corporate tax rate (11% – 22%).

This scheme is designed to support small and medium-sized enterprises (SMEs) and encourage new business setups in Indonesia.

Why This Matters for Foreign Investors

For those looking to set up company in Bali as foreigner, the 0.5% tax is a significant advantage in the early years of operation. It allows foreign-owned companies to minimize their tax burden while establishing their brand in the Indonesian market.

Take Advantage of Indonesia’s Tax Incentives

Setting up a PT PMA in Bali offers legal certainty and access to tax benefits like the 0.5% final tax. If you’re ready to start your business in Indonesia, now is the time to take advantage of these incentives. Contact Indoned Consultancy for a free consultation on how to set up company in Bali as foreigner and maximize your tax benefits.

Disclaimer

The information provided here is based on our long experience. The process or requirement may vary depending on the specific facts and conditions. Besides, the law and regulations in Indonesia subject to frequent changes. Please contact us as your consultant to get an up to date information and accurate advice. More Information click here and You can also follow our social media accounts to see the latest information posts. please click on the following links: Facebook, Instagram, Linkedin, and Twitter.

Get your free consultation now!

INDONED CONSULTANCY

The Indoned Team is committed to driving societal change and promoting environmental sustainability. Working in innovative ways with government, non-profit organizations, and civil society, we are designing and delivering solutions that contribute to a sustainable and prosperous future for all.

Join our newsletter

Useful Link

Contact Us

Istana Kuta Galeria, Central Parkir Patih Jelantik Street PM 1 No. 21 Kuta – Bali 80361(Indonesia)

Service

New Compliance Requirements for PMA Companies in Indonesia: Is Your Company Ready?