MoF-136/2024: Pillar 2 Overview
In December 2024, Ministry of FInance (MoF) issued MoF Regulation No.136/2024 to implement the OECD/G20 BEPS Pillar Two (Global Minimum Tax) framework domestically. The regulation becomes effective starting 1 January 2025, marking Indonesia’s formal adoption of the 15% global minimum effective tax rate. It establishes three key mechanisms: the Income Inclusion Rule (IIR), Undertaxed Payments Rule (UTPR), and Domestic Minimum Top-Up Tax (DMTT). IIR and DMTT take effect in 2025, while UTPR will apply one year later in 2026. The scope covers multinational enterprise (MNE) groups with annual consolidated revenue of at least EUR 750 million (or equivalent) in the preceding fiscal year. It applies to both Indonesian resident entities and permanent establishments (PEs) that are part of such MNE groups. The regulation requires each in-scope group to calculate GloBE Income and Effective Tax Rate (ETR) for every jurisdiction where it operates. If an entity’s ETR is below 15%, the “top-up tax” must be paid to bring the total tax up to that threshold. Entities must file a GloBE Information Return and, where relevant, a Top-Up Tax Return to the Directorate General of Taxes within specified deadlines. Overall, PMK 136/2024 ensures that large multinational groups doing business in Indonesia contribute a minimum 15% tax burden, aligning national tax policy with the global BEPS Pillar Two standards.