New Regulation, Electric Car and Motorcycle Tax No Longer Free

WARGA LAMPUNG ■ JAKARTA — The Ministry of Home Affairs has just issued a new regulation that will impose taxes on electric vehicles in Indonesia. This regulation is Minister of Home Affairs Regulation Number 11 of 2026 concerning the Basis for Imposing Motor Vehicle Tax, Vehicle Ownership Transfer Fee (BBNKB), and Heavy Equipment Tax.

In this new regulation, electric vehicles are not listed as objects exempt from PKB and BBNKB. Therefore, battery-powered cars and motorcycles, or electric vehicles, are subject to Motor Vehicle Tax (PKB) and Motor Vehicle Ownership Transfer Fee (BBNKB).

Although no longer 100 percent free, owners and prospective buyers of electric cars and motorcycles should not hesitate to switch. This new regulation does not completely revoke the privileges of non-emission vehicles.

Based on Article 19 of Minister of Home Affairs Regulation No. 11 of 2026, regional governments are still mandated to provide incentives, either in the form of exemptions or reductions in PKB and BBNKB rates for users of battery-based electric vehicles.

This wording allows local governments to avoid immediately applying the normal tax rate, but instead offer discounts or reductions in the tax burden.

What's more, this tax reduction incentive is confirmed to also apply to electric vehicles manufactured before 2026, and even includes fossil-fueled vehicles that have successfully converted to electric vehicles.

Responding to this regulatory change, the Head of the Jakarta Regional Revenue Agency (Bapenda), Lusiana Herawati, confirmed the change, stating that electric vehicles will indeed be subject to vehicle tax (PKB) and vehicle tax (BBNKB) payments going forward.

"We will certainly impose taxes according to the latest regulations," she said today. (dea)