Jakarta Announces Motor Vehicle Fuel Tax Reduction
April 24, 2025
Tax Cut for Jakarta Residents
Jakarta Gov. Pramono Anung announced a reduction in the Motor Vehicle Fuel Tax (PBBKB) for private and public vehicles,providing financial relief to Jakarta residents. The decision,revealed on Wednesday,April 23,marks a critically important shift from the previous tax rate.
Did You Know?
The Motor Vehicle Fuel Tax (PBBKB) applies to all types of fuel oil (BBM) or gas used by motor vehicles and heavy equipment in Jakarta.
- Private Vehicles: Tax reduced from 10% to 5%.
- Public Vehicles: Tax set at 2%.
According to Gov. Anung, Yesterday, I made a decision for Jakarta. We will provide a discount, reducing the tax from 10% to 5% for private vehicles and 2% for public vehicles.
Background on the Tax Change
The 10% PBBKB rate had been in effect for over a decade. The new provisions grant the governor the authority to adjust the rate, a move aimed at easing the financial burden on Jakarta’s residents.
Gov. Anung stated, This is a form of relief for Jakarta residents. It is a decision made by the Jakarta Governor and will be socialized shortly. The gubernatorial regulation (Pergub) will be drafted immediately.
Pro Tip
While consumers don’t directly remit the PBBKB, fuel providers (producers or importers) collect the tax and submit it to the regional treasury when fuel is distributed.
Interestingly, Gov. Anung admitted surprise regarding the existing 10% PBBKB rate,which is outlined in Jakarta Provincial Regulation No. 1 of 2024 on Regional Taxes and Levies. This regulation stems from Law No. 1 of 2022 on Financial relations between the Central Government and regional Governments (UU HKPD).
He explained,The law has already provided for this tax,stating a maximum rate of 10%. Jakarta had not made a specific decision.It will be finalized at 3:00 pm today. We held a meeting yesterday,but I had not yet reached a decision.
Impact and Purpose of the PBBKB
The Jakarta Regional Revenue Agency (Bapenda) clarified that the PBBKB applies to all fuel types used by motor vehicles and heavy equipment. The tax is included in every fuel purchase.
A special exemption exists for public transport vehicles, which were previously charged 5%, half the standard rate. This policy was created to support more affordable public transportation,
Bapenda stated.
The PBBKB is intended to bolster the regional economy and promote more responsible fuel consumption. Jakarta Provincial Regulation No. 1 of 2024, enacted during Heru Budi hartono’s governance, initially raised the PBBKB rate from 5% to 10% [[1]].
The tax itself is not new,having been previously governed by Jakarta Provincial Regulation No. 10 of 2010 on Motor Vehicle Fuel Tax.
FAQ: Motor Vehicle Fuel Tax (PBBKB) in Jakarta
- Who pays the PBBKB?
- Fuel providers (producers or importers) collect and remit the tax.
- What is the new PBBKB rate for private vehicles?
- 5%.
- What is the new PBBKB rate for public vehicles?
- 2%.
- What is the purpose of the PBBKB?
- To improve the regional economy and encourage wiser fuel consumption.
