Indonesia's parliament approved legislation on establishing international financial centres with a 50-year tax holiday for qualifying investors, targeting IDR 500 trillion in capital inflows.
Indonesia’s parliament unanimously approved legislation that will let the government establish international financial centres (IFCs) across the country on Tuesday, 21 July 2026.
The law aims to pull in foreign capital and support the government’s goal of hitting 8% annual economic growth by 2029. Southeast Asia’s biggest economy has struggled to develop its financial sector competitively against established regional rivals.
The incentive structure is aggressive. Investors who qualify will receive a 50-year tax holiday, full tax exemptions on income earned outside Indonesia, and selective exemptions from value-added tax.
Officials haven’t locked in a final site yet, but they’ve flagged Bali as the leading candidate for the first centre. They are projecting it could draw IDR 500 trillion in investment.
Once the law takes effect, Jakarta will establish a dedicated government body and supervisory board—both reporting directly to the president and parliament—to oversee the centres. The framework also includes a special arbitration body and court specifically for disputes that emerge within the financial zones.
