Indonesia Tightens the Screws: Crypto Traders & Miners Hit With Heftier Tax Burdens

Jakarta just dropped the hammer on crypto—again. The archipelago nation jacked up tax rates for digital asset traders and mining operations, squeezing margins in what was once a tax-friendly haven.

The new math:
No specifics yet on percentages, but expect fatter government slices from every trade and mined block. Indonesian hodlers now face the same old song: innovate globally, get taxed locally.

Miners feeling the heat:
Energy-intensive operations—already battling slim profits—just got another reason to eye Kazakhstan or Texas. When the taxman cometh, hashpower fleeth.

Traders’ dilemma:
Buy/sell spreads just got tighter. Day traders might pivot to derivatives or privacy coins, while long-term holders grit their teeth and HODL through the bureaucracy.

Here’s the kicker: these hikes land while Indonesia’s SEC-equivalent still debates *how* to classify crypto. Classic bureaucracy—tax first, define later. Meanwhile, Singapore’s VASPs are already rolling out the welcome mats.

Bottom line? Another government sees crypto’s growth and thinks ‘revenue stream’ instead of ‘economic catalyst.’ Bulls might shrug this off—after all, taxation beats outright bans. But for Indonesia’s crypto scene? Winter just got chillier.

Transaction Tax Rate Changes

The transaction tax for Domestic Exchange Sellers has increased from 0.1% to 0.21% per trade, representing a 110% rate increase. While tax for Foreign Exchange Sellers has jumped from 0.2% to 1.0% per transaction for international crypto platforms like Binance, Coinbase, and other overseas exchanges.

In addition, the previous value-added tax (VAT) of 0.11% to 0.22% per transaction for cryptocurrency buyers has been completely removed under the new framework. This new tax structure creates significant cost advantages for using domestic Indonesian exchanges over international platforms, potentially driving trading volume to local operators.

Cryptocurrency Mining Tax Restructuring

Effective Immediately, VAT on cryptocurrency mining operations doubles from 1.1% to 2.2% starting August 1, 2025. The current 0.1% special income tax on mining operations will be eliminated in 2026, with mining income shifting to Indonesia’s standard income tax system.

Post-2026 mining income will be taxed under either personal income tax rates or corporate tax rates depending on the operational structure, potentially creating significant tax variations based on business organization.

Market Impact and Industry Response

A local media outlet recently reported that Indonesia’s cryptocurrency user base has reached 14 million, exceeding the country’s stock market investor population and making the tax changes significant for domestic financial markets. In the current regulatory landscape, cryptocurrency trading is legal in Indonesia but digital assets cannot be used as payment methods for goods and services.

Tokocrypto, a Binance-affiliated Indonesian exchange, stated the tax changes represent positive recognition of cryptocurrencies as financial assets rather than commodities. However, the exchange requested “a short grace period to allow exchanges time to adjust” to the new compliance requirements.

“We also emphasize the importance of strengthening oversight and tax enforcement on crypto asset transactions conducted through foreign platforms,” Tokocrypto representatives stated regarding the higher foreign exchange tax rates.

Government Revenue Strategy

The Indonesian government’s tax restructuring reflects efforts to treat cryptocurrencies as regulated financial assets while capturing revenue from the country’s rapidly growing digital asset market. The policy creates clear incentives for users to migrate from foreign platforms to domestically regulated exchanges.

Industry observers note that Indonesian cryptocurrency investors now face higher tax burdens compared to traditional stock market investors, potentially affecting market growth dynamics. Some analysts suggest tax incentives could better support the crypto sector’s continued expansion. 

Also Read: SEC Approves In-Kind Redemptions for Bitcoin, ethereum ETFs