- The basis is Ministry of Finance Regulation PMK 90/2025 of 18 December 2025: the government bears the 11% VAT on the first Rp 2 billion of a new home priced up to Rp 5 billion, handed over in 2026. Maximum benefit — Rp 220 million.
- A foreigner qualifies when buying as an individual with a valid KITAS or KITAP and taking title in a form permitted to foreigners — on first transfer from the developer.
- Excluded: leasehold (Hak Sewa), purchase through a PT PMA, the secondary market, and units not ready for occupation. Those are precisely the three routes most foreign purchases in Bali take.
- The conditions are strict: one benefit per person, no down payment before 1 January 2026, handover by BAST during 2026, the developer must register the unit in SIKUMBANG, and no resale for a year.
- The conclusion for a Bali buyer: the incentive is real, but it does not apply to the typical leasehold villa. It can be used in a narrow scenario — a KITAS holder buying a new apartment or house in ownership.
In short: in 2026 Indonesia runs an incentive under which the government bears the VAT on the first Rp 2 billion of a new home's price — up to Rp 220 million saved on one transaction. Foreigners qualify. But the three most common purchase routes in Bali — leasehold, a PT PMA company and the secondary market — are excluded. So the question "are we entitled to it?" almost always gets the answer "no", and it helps to understand why — so as not to build a calculation on it, and not to believe a presentation that promises it. The overall map of taxes on purchase and ownership is covered in Property taxes in Bali; this piece is about one incentive and its limits.
What exactly the state gives
The mechanism is called PPN DTP — "VAT borne by the government" (Ditanggung Pemerintah). The regulation in force is Ministry of Finance Regulation PMK 90/2025, signed on 18 December 2025. The 2026 parameters:
| Parameter | Value |
|---|---|
| VAT rate on new housing | 11% |
| Portion of the price on which the state bears the VAT | the first Rp 2 billion |
| Maximum property price to qualify | Rp 5 billion |
| Coverage | 100% throughout 2026 |
| Maximum benefit | Rp 220 million (≈ $12,400 at ~17,700 to the dollar) |
| Handover period by BAST | 1 January — 31 December 2026 |
Example: an apartment at Rp 3 billion. VAT on the first Rp 2 billion (Rp 220 million) is paid by the state; VAT on the remaining Rp 1 billion (Rp 110 million) by the buyer. A property above Rp 5 billion does not qualify at all.
Sources: Directorate General of Taxes (DJP), explainer on PMK 90/2025; ILA Global Consulting, 17 Jan 2026.
Who qualifies — and why foreigners do too
The incentive is addressed to individuals. Nationality is not a barrier: a foreigner with a valid KITAS or KITAP and an NPWP tax number can use it — provided the property is taken in a form permitted to foreigners under the ownership rules. In practice that is the right of use over a house or apartment available to residents; ownership in the form of Hak Milik is not available to a foreigner at all.
The "one person — one benefit" rule runs on NIK or NPWP: a second purchase by the same person in 2026 gets no relief. Which visa statuses a property owner can hold, and what each gives, is covered in KITAS and a visa for a villa owner.
Who does not qualify — the section that matters most
| Route | Qualifies? | Why |
|---|---|---|
| Leasehold (Hak Sewa) | No | The incentive is for transfers of ownership; a lease, even for 69 years, is not one |
| Purchase through a PT PMA | No | A consumer incentive for individuals; companies are excluded |
| Secondary market | No | First transfer from the developer only |
| A unit under construction, not ready to occupy | No | New, ready housing handed over by BAST in 2026 is required |
| Down payment made before 1 January 2026 | No | An explicit condition of the regulation |
| A new apartment or house in a form permitted to foreigners, buyer with KITAS/KITAP | Yes | The only working scenario for a foreigner |
The first three rows describe how the overwhelming majority of foreign purchases in Bali are structured. Which is exactly why the much-discussed incentive has nothing to do with the typical villa.
How leasehold differs from ownership, and why it remains the standard for foreigners, is covered in Leasehold in Bali and A PMA company or a leasehold. The full set of questions on what a foreigner can buy at all is in Can a foreigner buy a villa in Bali.
The conditions on which the benefit is lost
Even in the working scenario the benefit hangs on a chain of formalities, and part of that chain is the developer's, not the buyer's.
- Unit registration. The developer must register the house or apartment in the SIKUMBANG system (BP Tapera); the unit receives an identification code. Without it the benefit cannot be processed.
- The VAT invoice. The seller issues it with transaction code 07 (07 and 04 for prices above Rp 2 billion) and a mandatory note that the VAT is borne by the government under PMK 90/2025.
- The BAST handover record. Its date must fall within 2026 and be registered by the developer in the system; a missed realisation report cancels the benefit retroactively.
- No resale. The property may not be transferred for 12 months after delivery.
What this means for a buyer in Bali
Three practical consequences.
First. There is no incentive in the cost of a leasehold villa, and there cannot be. If a presentation shows one, it is either an error or deliberate embellishment. What the price actually consists of, and which payments come on top of it, is covered in How much a villa in Bali costs in 2026.
Second. The incentive is real for a narrow scenario: a resident with a KITAS or KITAP buys a new apartment or house from a developer in a form permitted to foreigners, handed over in 2026, for their own use, with no resale for a year. For those moving to the island to live rather than to invest, that can be a meaningful sum.
Third. The programme has been announced as running to the end of 2027, but the instrument in force covers 2026 only. Next year's terms will be set separately; do not build them into a model in advance.
Bottom line: Indonesia's 2026 VAT incentive on housing is up to Rp 220 million saved under PMK 90/2025, and foreigners with a KITAS or KITAP qualify. But it applies only to transfers of ownership on a first purchase by an individual — so it works neither for leasehold, nor for a PT PMA, nor for the secondary market, which is to say for the overwhelming majority of foreign transactions in Bali. Knowing its limits is useful for exactly one thing: not counting on it in a typical deal, and not believing a presentation that promises it for a leasehold villa.
This material is informational only and is not tax or legal advice. We are not tax advisers; check the regulation's terms and the ownership rules for foreigners against the current text and with your own adviser.
FAQ
What is PPN DTP and what is it worth?
PPN DTP is VAT borne by the government (Ditanggung Pemerintah). Under PMK 90/2025 it covers 100% of the 11% VAT on a tax base of up to Rp 2 billion for a property priced up to Rp 5 billion. The maximum saving is Rp 220 million — roughly $12,400 at around 17,700 rupiah to the dollar in September 2026.
Does a foreigner qualify?
Yes, when buying as an individual with a valid KITAS or KITAP, holding an NPWP, and taking the property in a form permitted to foreigners under the ownership rules. A purchase through a PT PMA company does not qualify — the incentive is designed as a consumer measure.
Does a leasehold villa qualify?
No. The incentive applies only to transfers of ownership; leasehold (Hak Sewa) is a lease, not a transfer of title. Since most foreign purchases in Bali are structured as leasehold, the incentive does not work for the typical villa.
What are the deadlines and restrictions?
No down payment before 1 January 2026; handover by BAST between 1 January and 31 December 2026; the unit must be new and ready to occupy, on first transfer; one benefit per buyer by NIK/NPWP; no transfer of the property within 12 months of delivery.
What must the developer do?
Register the unit in the SIKUMBANG system (BP Tapera), issue the VAT invoice with transaction code 07 (07 and 04 for prices above Rp 2 billion) marked with a reference to PMK 90/2025, and file the realisation report. A developer's error in that chain costs the buyer the benefit.
Will the incentive be extended beyond 2026?
The programme has been announced as running to the end of 2027, but the regulation in force, PMK 90/2025, covers handovers in 2026 only. The 2027 terms will be set by a separate instrument — do not model on them in advance.