The government is targeting the draft government regulation on Final Income Tax incentives for book author royalties to be published in November 2026.
Creative Economy Minister Teuku Riefky Harsya said the regulation is currently entering the harmonization stage after receiving approval for an initiative permit from President Prabowo Subianto.
Through this policy, the final income tax rate on book authors' royalty income has been reduced to 1.5 percent from the previous 15 percent.
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This tax is final so that the tax obligation on royalty income is completed after the tax deduction is made by the publisher.
This income is then reported in the Annual Tax Return (SPT) without being recalculated using the progressive tax rate.
Teuku Riefky confirmed that the regulation had gone through a meaningful participation stage before entering the harmonization process.
However, there are conditions that must be met, namely that the author must write a work that has an official International Standard Book Number ( ISBN).
The government hopes that this policy will provide tax certainty, improve the welfare of authors, and strengthen the sustainability of the national publishing industry.
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