Indonesia Cracks Down on Crypto with Hefty Tax Hikes

The Indonesian government has just announced a significant tax overhaul that’s set to shake up the country’s burgeoning crypto scene. As of August 1st, the government will be introducing a slew of new tax rates on cryptocurrency transactions, both domestic and international. The move is likely to have far-reaching consequences for the industry, with some exchanges potentially facing a major rethink of their strategies.

Tax Hikes: What You Need to Know

So, what exactly do these tax hikes entail? For starters, the overseas exchange transfer tax is set to skyrocket from 0.2% to a whopping 1%. Domestic exchanges, on the other hand, will see a more modest increase of 0.1%. This means that sellers of crypto assets trading on domestic stock exchanges will now have to cough up a tax of 0.21% on transaction values – up from the previous rate of 0.11%.

But here’s the thing: buyers of crypto assets are actually getting a bit of a break. They’ll no longer have to pay VAT (Value-Added Tax), which was previously set at a rate of 0.11% to 0.22%. It’s a small mercy, perhaps, but a welcome one nonetheless.

Crypto Mining Takes a Hit

However, it’s not all good news. The Indonesian government has also decided to increase the VAT rate on crypto mining, doubling it from 1.1% to 2.2% as of August this year. It’s a move that’s likely to have significant implications for the country’s crypto mining industry, which has been growing in recent years.

The Bigger Picture: Indonesia’s Crypto Boom

So, why the sudden crackdown on crypto? The answer lies in the country’s rapidly growing crypto market. According to the Financial Services Authority (OJK), the overall transaction volume for crypto assets in Indonesia tripled in 2024 compared to the previous year, reaching a staggering $39.67 billion. And it’s not just the transaction volume that’s on the rise – the number of crypto exchange users in Indonesia has also surpassed the number of investors on the country’s stock exchange.

In fact, as of May 2025, there were a whopping 14.78 million crypto exchange users in Indonesia, with the total transaction volume for crypto reaching 49.57 trillion rupiah (approximately $3.02 billion USD). It’s a staggering increase of 39.21% compared to the previous month, and a clear indication that the country’s crypto market is showing no signs of slowing down.

As Hasan Fawzi, the managing director of the OJK’s monitoring technology, digital financial assets, and crypto assets department, noted, “The increasing trend in the number of consumers and crypto assets transactions shows that the trust of consumers and the national market for crypto assets are still well maintained.” It’s a vote of confidence in the industry, perhaps, but one that’s also tempered by the government’s desire to regulate and tax the market more effectively.