Indonesia hikes crypto taxes up to 5x starting August 1 mining VAT doubles to 2.2

Starting August 1, Indonesia will significantly increase taxes on cryptocurrency transactions as part of a new regulation announced by the finance ministry on July 30, 2025 [1]. Sellers on domestic exchanges will now face a tax rate of 0.21% on transaction value, up from the previous 0.1%, while those trading on overseas platforms will see their tax rate jump from 0.2% to 1%—a fivefold increase [2]. The move aims to address growing concerns over tax avoidance via international platforms and to generate additional government revenue from the rapidly expanding crypto market [3].

The tax adjustments also extend to cryptocurrency mining, with the value-added tax (VAT) rate doubling from 1.1% to 2.2% [1]. A previous 0.1% special income tax on mining has been removed, meaning mining profits will now be subject to standard corporate or personal income tax rates starting in 2026 [1]. Meanwhile, buyers are no longer required to pay VAT, which had previously ranged between 0.11% and 0.22%, offering some relief to crypto investors [1].

The regulatory overhaul reflects the government’s attempt to balance tax revenue with the need to support industry growth. Indonesia’s crypto transaction value tripled in 2024 to over $39.67 billion, with more than 20 million users trading on local platforms—surpassing the number of stock market investors [1]. Despite this growth, the 2022 dual taxation policy led to a 63% drop in crypto tax revenue in 2023 to $31.7 million, as traders moved to offshore exchanges to avoid high domestic tax burdens [1].

Tokocrypto, a Binance-backed exchange, expressed cautious support for the changes, noting that the reclassification of cryptocurrencies as financial assets rather than commodities is a positive step [1]. The firm, however, called for a one-month grace period to allow the industry to adjust and emphasized the need for stronger oversight of offshore trading platforms [1]. It also pointed out that the new tax rate of 0.21% for domestic sellers remains higher than the capital gains tax on stock investments, potentially hindering local innovation if not balanced with supportive policies [1].

The regulatory shift also aligns with Indonesia’s broader strategy to reassign crypto oversight from the Commodity Futures Trading Agency to the Financial Services Authority—a transition that was previously delayed due to incomplete regulations [1]. In May 2025, the government suspended Sam Altman’s Worldcoin project for operating without proper permits, highlighting its commitment to enforcing data sovereignty and digital asset regulations [1].

By imposing higher taxes on overseas platforms, the government aims to reduce the competitive advantage held by unregulated foreign exchanges and support local market participants [1]. The changes also coincide with a new information-sharing agreement between Indonesia and Australia, signed in April 2024, to enhance cross-border tax cooperation and improve asset identification [1].

As Indonesia continues to refine its approach to cryptocurrency, the August 1 implementation marks a key step in its strategy to capture more value from a booming digital asset market while maintaining its position as a regional hub for crypto adoption [1].

Source:

[1] Anas Hassan for Cryptonews (https://cryptorank.io/news/feed/f8322-indonesia-hikes-crypto-taxes-up-to-5x-starting-august-1-mining-vat-doubles-to-2-2)

[2] TheDefiant.io (https://thedefiant.io/news/regulation/indonesia-doubles-crypto-levies-targets-offshore-trades-1-august-ac363a9e)

[3] Coinfomania (https://coinfomania.com/indonesia-crypto-tax-august-2025/)