Jakarta. Indonesia has announced an economic stimulus package for the second quarter and second half of 2026 to mitigate the impact of the situation in the Middle East.

The package includes 8 policies split into the following three pillars:

Pillar 1: Stimulus and Incentives which aim to spur consumption and help businesses.

• The government will cut the royalty income tax for book writers to a final rate of 1.5%;
• Transportation Discounts for School Holidays: 
  • 30% discounts for railway ticket (June 20-July 5); 30% discounts for base tariff for Pelni ships (June 20-August 15); free services tariffs for ASDP ports (June 20-July 5) -- all totaling Rp 190.5 billion and 3 million passengers;
  • 100% government-borne value-added tax for domestic economy flights (Rp 472.7 billion for 2.3 million passengers).
• Transportation Discounts for Christmas and Year-End Holidays:
  • 30% discount on train tickets (Dec. 22, 2026 to Jan. 4, 2027)
  • 30% discount on base fares for Pelni ships (Dec. 17, 2026, to Jan. 10, 2027); Free ASDP port services from Dec. 22, 2026, to Jan.10, 2027, with a total budget allocation of Rp161.4 billion and a target of 2.8 million passengers. A 100% government-borne value-added tax for scheduled domestic economy-class flights will also be implemented with a budget of Rp 722 billion, targeting 3.7 million passengers.
• Incentives for the industrial sector: Zero percent duty on LPG and patric material imports. Economic boons for the LPG alone are around Rp 2.25 trillion in the form of cost reductions and possible multiplier effects. The government had also reduced the import duty on aircraft spare parts to 0% to support the aviation industry by reducing airline operating costs and strengthening the competitiveness of the MRO industry.

Pillar 2: Internship and Vocational Programs

• National internship program to begin in July 2026 with a budget of Rp 4.14 trillion and is open for 150,000 fresh university graduates.
• Vocational training with a budget of Rp 2.12 trillion to improve skills and competency in the workforce. This program's priority targets specifically focus on 220,000 vocational high school graduates to prepare them for work, as well as protection for 50,000 workers affected by layoffs to provide them with new skills to transition back into the workforce.

Pillar 3: Food Assistance

• 10 kg of Rice Assistance, starting in July 2026. The government will distribute 10 kg of rice to 33.24 million beneficiary families for three consecutive months. The allocated budget is estimated at Rp 17.54 trillion.
• Soybean Price and Food Supply Stabilization Assistance (SPHP). The government is assisting tofu and tempeh producers at a maximum of Rp 2,000 per kg for a total quota of 250,000 tons in this first phase, for regions where soybean prices are above the reference purchase price.

"All this totals Rp 26.34 trillion ($1.5 billion) for the second semester," senior economic minister Airlangga Hartarto told a press conference in Jakarta on Monday. 

"About Rp 2.04 trillion are transportation incentives, while some Rp 6.26 trillion others are internship and vocational training. We are also providing Rp 18.04 trillion worth of food aid."

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