Information, not advice: Bali SEZ Intelligence is an independent editorial guide — not a government body, zone operator, or licensed adviser. Incentives and regulations change and apply case-by-case; verify with the OSS system, official KEK channels, and licensed Indonesian counsel before acting. If you engage a partner we introduce, that partner may pay us a referral fee at no cost to you.
The global minimum tax in Indonesia is a 15% minimum effective corporate income tax rate imposed on multinational enterprise (MNE) groups with consolidated global revenue of EUR 750 million or more, enacted domestically via PMK 136/2024 and operative for fiscal years beginning on or after 1 January 2025. It is Indonesia’s implementation of the OECD/G20 Pillar Two framework. For most businesses evaluating a KEK investment in Bali, the GMT is a non-issue — the EUR 750 million threshold sits well above the realistic tenant population for KEK Kura Kura or KEK Sanur. For large multinational groups, it is a structural constraint that can partially or fully offset the value of a KEK tax holiday that looked transformative on paper.
This piece explains how the GMT interacts with the Indonesia SEZ tax holiday regime, who actually falls in scope, and what the Qualified Refundable Tax Credit (QRTC) mechanism introduced alongside the GMT is designed to do. The KEK holiday rules under PMK 237/PMK.010/2020 as amended by PMK 33/PMK.010/2021 remain formally in force. Nothing in PMK 136/2024 repeals them. The question is whether the top-up tax neutralizes what the holiday saves.
What Pillar Two Actually Does
The OECD’s Pillar Two framework, now reflected in over 140 national implementations, establishes a global floor: no large MNE group should pay an effective tax rate below 15% in any jurisdiction where it operates. The mechanism works through two interlocking rules. The Income Inclusion Rule (IIR) allows a parent jurisdiction to collect a top-up tax when a subsidiary’s effective rate falls below 15%. The Undertaxed Profits Rule (UTPR) operates as a backstop. Indonesia, as a host country for foreign-parented MNE operations, introduced the Qualified Domestic Minimum Top-up Tax (QDMTT) via PMK 136/2024 — a domestic top-up that Indonesia collects itself rather than surrendering the revenue to the parent company’s home jurisdiction under the IIR.
The logic for Indonesia is straightforward: if an MNE group’s subsidiary here benefits from a zero-CIT holiday and the group’s effective Indonesian rate drops to, say, 2%, the OECD framework allows the parent country (say, Germany or Japan) to collect a 13-percentage-point top-up tax. The QDMTT lets Indonesia collect that 13 points domestically instead. The MNE group pays the same total amount — 15% effective — but the Indonesian treasury captures the top-up rather than ceding it abroad.
How It Interacts With the KEK Tax Holiday
The Indonesia SEZ (KEK) tax holiday reduces CIT to zero on income from kegiatan utama (main activities) for periods of 10, 15, or 20 years depending on the committed investment tier. For an in-scope MNE group, the holiday still operates as written — the DJP does not assess CIT. But the QDMTT can then apply on top, taxing income that the holiday left untouched.
The effective outcome for a large MNE operating inside KEK Kura Kura or KEK Sanur: the 0% CIT holiday may translate to something closer to a 15% effective rate at the consolidated group level, depending on how the group’s substance-based income exclusions are calculated and whether any transition-period safe harbours apply. The headline saving — potentially IDR hundreds of billions over 20 years — narrows substantially.
This is what PwC’s Indonesia tax summary (which ranks for the incentives query on Google) notes briefly: the domestic top-up applies even to pre-existing holiday holders whose holidays were granted before 9 October 2024. That date matters: PMK 136/2024 does not grandfather pre-2025 approvals. An MNE group that received a 20-year KEK holiday approval in 2023 is not protected from the QDMTT if it meets the EUR 750 million threshold.
Who Is Actually In Scope
The threshold is consolidated global revenue of EUR 750 million or more in at least two of the four fiscal years preceding the reporting period. This is not an Indonesian revenue test — it is the MNE group’s worldwide consolidated revenue. A company with IDR 50 billion in Indonesian revenue can still be in scope if its global parent generates EUR 800 million across all subsidiaries.
Run through the realistic KEK Bali tenant categories:
| Investor Category | Typical Revenue Profile | GMT In Scope? | Holiday Outcome |
|---|---|---|---|
| Global hotel chain / branded-residence developer (IHG, Marriott, Accor affiliates) | Parent group revenue EUR 2–20 billion+ | Likely yes | Holiday partially or fully offset by QDMTT; net effective rate approaches 15% |
| Large international hospital group (regional hubs, listed entity) | Parent group revenue EUR 750M–5B | Borderline to yes | QDMTT applies above 15% gap; substance exclusions may reduce top-up partially |
| Regional/national hospital or wellness operator (Indonesia-based, unlisted) | Group revenue below EUR 750M | No | Holiday works as designed — zero CIT during the approved period |
| Indonesian family-owned conglomerate (local developer, tourism operator) | Typically below EUR 750M consolidated | No (in most cases) | Holiday works as designed |
| Mid-size foreign investor (PT PMA, IDR 100–500B project) | Foreign parent revenue variable; many SME-type groups below EUR 750M | Usually no | Holiday works as designed; verify parent group’s consolidated revenue |
| Sovereign wealth funds / state-owned entities | Potentially large; specific treatment varies under PMK 136 provisions | Check entity-specific rules | Depends on PMK 136 carve-outs for governmental entities |
| Tech company / data-centre operator with large MNE parent | Parent group (e.g., hyperscaler affiliate) often EUR 750M+ | Likely yes | Holiday substantially offset; QRTC design matters here |
The candid summary: most mid-market investors, Indonesian conglomerates, family offices, and foreign SMEs structuring through a PT PMA are below the EUR 750 million threshold. The GMT is a large-cap problem. Where it matters most is precisely the class of global-brand operators whose participation would most visibly validate the zones — the international hotel flags, major international hospital systems, large technology companies. Those are the investors who need to run a Pillar Two analysis before treating the KEK holiday as a core component of their financial model.
The Decision Flowchart: Are You In Scope?
Work through these questions in order. If you answer no at any point, the GMT does not currently affect your KEK holiday.
- Question 1: Is your entity part of a multinational enterprise group?
- A group means a parent and all entities it consolidates for financial reporting purposes, regardless of where they are incorporated. A wholly Indonesian PT PMA with no foreign parent is not in an MNE group. A PT PMA owned by a Singapore holding company, which is owned by a UK-listed parent, is in an MNE group.
- Question 2: Does the MNE group have consolidated annual revenue of EUR 750 million or more in at least two of the past four fiscal years?
- This is the OECD/BEPS threshold adopted in PMK 136/2024. EUR 750 million translates to approximately IDR 12.7–12.9 trillion at current exchange rates (2025 range). Revenue means gross revenue across all group entities worldwide — not just Indonesian operations, and not just the entities you control directly. If below this: stop here. GMT does not apply.
- Question 3: Does the Indonesian subsidiary’s effective tax rate fall below 15%?
- If the KEK holiday brings the group’s effective Indonesian rate to 0% (or near 0%), and no other Indonesian taxes or non-creditable levies push the rate toward 15%, the QDMTT may apply on the gap. If the group already pays other Indonesian taxes, royalties, withholding taxes, or local levies that bring the effective rate close to 15% even with the income tax holiday, the top-up may be small.
- Question 4: Do substance-based income exclusions (SBIE) reduce the top-up base?
- Pillar Two allows exclusions from the top-up base for a notional return on tangible assets (7.5% of net book value, reducing to 5% by 2033) and on payroll (9.5%, reducing to 5%). For capital-intensive investments — a hospital with IDR 600 billion in equipment and buildings, or a hotel with significant physical plant — the SBIE can meaningfully reduce the effective top-up amount. This is one reason why Pillar Two hurts asset-light businesses (intellectual-property holding, treasury companies, royalty entities) more than it hurts the physical investments typical of KEK Bali tenants.
- Question 5: Do any transition-period safe harbours apply?
- The OECD published Transitional Country-by-Country Report (CbCR) Safe Harbours for the first years of Pillar Two implementation. These allow groups to defer full Pillar Two calculations in jurisdictions where simplified tests are met. Whether Indonesia qualifies under these safe harbours for your group, and for which fiscal years, is a group-level calculation — not one that can be answered generically.
If you answered yes to questions 1 through 3 and the exclusions and safe harbours in questions 4–5 do not eliminate the top-up, you have a GMT exposure that partially or fully neutralizes the KEK holiday. The degree of neutralization depends on the numbers — it is not automatically a complete offset.
What QRTC Means and Why It Was Introduced
Indonesia introduced the Qualified Refundable Tax Credit (QRTC) as a structural response to the Pillar Two problem. The OECD’s rules treat certain refundable tax credits differently from non-refundable tax incentives: a credit that is fully refundable within four years of being earned is included in the covered taxes computation (meaning it contributes to the effective rate calculation) rather than being treated purely as a subsidy that reduces covered taxes. A QRTC can therefore be GMT-compatible in a way that a straight tax exemption or holiday is not.
The policy logic: rather than exempting an MNE from CIT (which, under Pillar Two, just shifts the tax payment to the parent country or triggers the domestic top-up), Indonesia can instead charge the CIT and then issue a refundable credit for an equivalent or greater amount. The MNE’s effective tax rate as calculated under Pillar Two reflects the CIT charged; the economic benefit is delivered via the credit. For in-scope groups, this structure can restore much of the financial value that a straight holiday loses to the QDMTT.
The QRTC architecture under PMK 136/2024 is still developing. The practical deployment — how businesses apply for the credit, what qualifying activities it covers, how it interacts with the existing KEK PMK fiscal facilities — had not been fully operationalized at the time of this writing (mid-2026). Large MNE groups scoping Bali KEK investments should engage directly with the DJP and their tax counsel to understand the current state of the QRTC mechanism before building it into financial projections. The policy intent is clear; the execution detail matters.
What Remains in Force: KEK Holiday Not Repealed
Three things worth stating plainly, because agency guides sometimes create confusion by describing the GMT as if it overrides the KEK framework:
First, PMK 237/2020 as amended by PMK 33/2021 remains in force. The KEK tax holiday tiers — 10, 15, and 20 years by investment tier, with a 50% tail for two years — are intact. New applications continue to be processed via OSS. No regulation has amended or repealed these provisions.
Second, the GMT does not apply to businesses below the EUR 750 million consolidated revenue threshold. For the majority of investors evaluating KEK Kura Kura or KEK Sanur, the holiday math on the SEZ tax holiday page applies as written, without GMT adjustment.
Third, even for in-scope MNE groups, the holiday and the QDMTT operate at different levels. The DJP does not re-assess CIT on a holiday holder. The QDMTT is a separate computation that may result in a separate payment. The two are legally distinct instruments, even if their combined economic effect is what matters.
Practical Implications for Investors in KEK Kura Kura and KEK Sanur
KEK Kura Kura Bali (established by PP 23/2023, 498 ha, Serangan Island) targets tourism and creative-industry tenants. Its 30-year buildout to the 2052 horizon is designed to attract global-calibre investors: the Mitsubishi Estate joint venture on the Grand Outlet Bali is one data point; the planned Bali International Financial Center backed by G20/GBFA engagement is another. These are precisely the categories of investment where GMT scope is more likely. A global luxury hotel brand, an international financial institution establishing a KEK presence under the IFC framework, or a large-scale tech company developing a data center campus — all of these warrant a Pillar Two analysis before the KEK holiday is presented internally as a guaranteed financial benefit.
KEK Sanur (PP 41/2022, 41.26 ha, health and tourism) anchors around the Bali International Hospital operated by PT Pertamina Bina Medika IHC, with a stated target of 140,000 patients by 2030 and cumulative investment realized at IDR 5.37 trillion as of April 2026. International hospital groups scoping Sanur as a clinical expansion market — whether as operators, clinical partners, or specialist annexe tenants — include entities that may be part of large listed healthcare conglomerates. The due-diligence checklist needs a GMT line item.
For investors who are clearly below the threshold, the analysis is simpler: the GMT is background information, not a live constraint. The holiday works. What remains is the standard due-diligence layer: ensuring the investment qualifies as kegiatan utama, filing via OSS before commercial operation, realizing the committed investment within the four-year window, and maintaining activity compliance throughout the holiday period. The risks and due diligence page covers the full set of structural risks in both zones.
If you want to map the GMT question to your specific group structure, our enquiry form routes to tax advisers with Indonesia Pillar Two experience — including advisers who have engaged with DJP on the QRTC framework. You can also reach us via WhatsApp. No one can pay to change what we publish; if you use our free guidance and proceed with a partner, they may pay us a referral fee at no extra cost to you.
The Bigger Picture: Indonesia’s Incentive Framework Under Pressure
The GMT is part of a broader structural tension in Indonesia’s investment incentive policy. For decades, the primary tool for attracting large-scale foreign investment was tax relief: holidays, allowances, exemptions. The KEK framework codified this into a zone-based system with transparent tiers. Pillar Two forces a rethink.
The Indonesian government’s response — introducing QRTCs, engaging with the OECD on what qualifies as GMT-compatible — signals awareness that the headline zero-rate holiday is less potent for large MNEs than it was before 2025. The policy direction is toward credits (which are GMT-compatible) and non-fiscal incentives (land rights, licensing speed, immigration facilitation, infrastructure access) that do not interact with the Pillar Two effective-rate calculation at all.
This is actually an argument for taking the non-fiscal incentive stack in the Bali zones more seriously. HGB land rights for up to 80 years (via the standard 30+20+30 renewal cycle under Cipta Kerja land reforms), streamlined one-stop licensing via the Administrator KEK, simplified foreign-worker RPTKA processing as a national-strategic-project pathway, and customs facilitation on medical equipment and capital goods — none of these interact with GMT. For large MNEs for whom the fiscal holiday is partially neutralized, the non-fiscal package becomes the differentiated value.
The risk is that Indonesia’s KEK proliferation under successive administrations — the Prabowo government has signaled a "KEK in every province" ambition — could dilute zone quality without necessarily improving the incentive design. A race to designate zones does not solve the GMT problem for large MNEs; it just distributes the same partially-neutralized holidays across more locations.
Frequently Asked Questions
Does PMK 136/2024 apply to all foreign companies investing in Indonesia, or only large multinationals?
PMK 136/2024 applies only to multinational enterprise groups with consolidated global revenue of EUR 750 million or more in at least two of the four preceding fiscal years. A foreign-owned PT PMA whose parent group is below this threshold — which includes most mid-market and family-owned foreign businesses — is not affected. The global minimum tax is not a general foreign-company tax; it is specifically a large-MNE measure. Smaller investors evaluating KEK Kura Kura or KEK Sanur can treat the GMT as background context rather than a live constraint on their holiday calculation.
If I already have an approved KEK tax holiday from before 2025, does PMK 136/2024 override it?
The KEK tax holiday remains formally valid — PMK 136/2024 does not revoke or amend the holiday itself. However, if your MNE group meets the EUR 750 million threshold, the Qualified Domestic Minimum Top-up Tax (QDMTT) can apply to the income that the holiday leaves tax-free, bringing your effective rate toward 15%. The holiday approval predating 9 October 2024 does not create a grandfather protection from the QDMTT. The DJP assesses the holiday and the QDMTT as separate instruments — the CIT remains at zero under the holiday, but the QDMTT computation operates on top of that position.
What is the Qualified Refundable Tax Credit (QRTC) and how does it differ from the KEK tax holiday?
The QRTC is an alternative incentive structure designed to be compatible with Pillar Two rules. Under the OECD framework, a tax credit that is fully refundable within four years is included in the calculation of covered taxes for effective-rate purposes — meaning it can raise the effective rate above 15% in a way that a straight tax exemption cannot. Indonesia introduced the QRTC in PMK 136/2024 as a GMT-compatible incentive tool. In practical terms: rather than exempting an in-scope MNE from paying CIT (which triggers a top-up under GMT), Indonesia charges CIT and refunds it via the credit, keeping the effective rate above 15% under Pillar Two rules while still delivering the economic benefit. The QRTC mechanism is still being operationalized as of mid-2026; investors should engage DJP and qualified tax counsel for current application procedures.
For a company just below EUR 750 million in global revenue, is there a risk of crossing the threshold and being caught by GMT mid-holiday?
Yes. If your group’s global consolidated revenue grows above EUR 750 million during the holiday period, you enter GMT scope for the fiscal years in which the threshold is met (provided it is met in two of the four preceding years). This is not a hypothetical concern for growth-stage companies. A business that accepts a 20-year KEK holiday today with EUR 600 million in global revenue should model the GMT exposure it would face if group revenue grows past the threshold in years three to five of the holiday. The incentive was designed assuming a static revenue profile; real businesses are not static. Build this into the financial model explicitly.
Does the Global Minimum Tax affect the VAT and customs benefits available inside the Bali SEZs, or only the income tax holiday?
PMK 136/2024 and the Pillar Two framework operate exclusively at the level of corporate income tax. The indirect tax benefits available inside KEK Kura Kura and KEK Sanur — PPN and PPnBM not collected on imports into the zone, import duty exemption and postponement, PPh Pasal 22 impor not collected, and local tax reductions under PP 40/2021 Article 100 — are entirely separate instruments that the GMT does not touch. Even for large MNEs for whom the income tax holiday is substantially neutralized by the QDMTT, the VAT non-collection and customs duty exemption on capital goods and equipment during the construction phase remain fully intact. These indirect-tax savings can represent significant cash-flow benefit during the build and fit-out period.