A two-phase VAT increase was originally scheduled in the Tax Harmonisation Law as part of Budget 2022: VAT rate to be increased from 10% to 11% on 1 April 2022, then to 12% by 1 January 2025.

According to Airlangga Hartaro, Chief Economic Minister, the second-stage VAT increase will take place in January 2025 as planned. Airlangga stated that the government is currently formulating macroeconomic and fiscal policies, including the new VAT rate, as part of its 2025 state budget preparations.