Jakarta. The Jakarta provincial government is drafting new regulations that will impose taxes on electric vehicles after the central government issued guidelines for regional administrations on EV taxation.

Previously, electric vehicles were exempt from the annual motor vehicle tax and vehicle ownership transfer tax. Buyers of new EVs also received significant value-added tax incentives.

However, following the issuance of Home Affairs Minister Regulation No. 11/2026, electric vehicles no longer automatically qualify for tax incentives.

Instead, the regulation grants regional governments the authority to offer exemptions or tax reductions for electric vehicles based on their respective fiscal capacity.

“Now that the Home Affairs Minister regulation has been issued, the Jakarta administration will soon formulate fair policies related to electric vehicles,” Jakarta Governor Pramono Anung said recently.

Future EV tax policies will not be uniform across Indonesia, with tax rates and incentives expected to vary depending on decisions made by individual local governments.

A 2023 Jakarta gubernatorial regulation, enacted before Pramono took office, set the tax rate for electric vehicles at zero percent.

Previously, vehicle taxes in Indonesia were calculated based on a vehicle’s base price and factors reflecting its contribution to road damage and environmental pollution.

Under the new regulation, however, environmental pollution is no longer explicitly mentioned, meaning electric vehicles and gasoline-powered cars could be treated similarly for taxation purposes.