Private House Construction Tax to Increase to 2.4%
Jakarta. The government will raise the tax on private house construction from 2.2 percent to 2.4 percent starting next year, a Finance Ministry advisor announced on Tuesday.
The tax applies to the construction of houses with a minimum size of 200 square meters, said Yustinus Prastowo.
He clarified that the tax on private home construction has been in place since 1994.
“This is not a new policy; it’s been around for the past 30 years,” he explained in a post on his X account.
His remarks came amid mounting criticisms about the private house tax among social media users.
The planned increase follows the scheduled rise in value-added tax (VAT) from 11 percent to 12 percent in early 2025, he added.
According to Yustinus, the tax on house construction is intended to promote fairness, as construction companies are required to pay taxes when building homes. Previously, individual homeowners could avoid paying the tax when hiring private contractors for similar amounts of work.
The tax only affects a small percentage of homeowners due to the minimum size requirement.
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