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Indonesia is entering a pivotal phase in its fiscal and financial policy transformation. Following key insights shared by Zac Lucas TEP, Head of Private Client Asia at Spencer West LLP, during the Hubbis Indonesia Wealth Management Forum on June 12, 2025, a clearer picture is emerging of how Southeast Asia’s largest economy intends to attract, regulate, and retain high-net-worth (HNW) wealth—both domestic and inbound.
Tax Reform: Enforcement Before Expansion
Lucas noted that despite speculation, a formal wealth or inheritance tax is unlikely to materialize before a new tax amnesty program is launched. However, the groundwork is being laid through the Core Tax system, a sweeping digital infrastructure designed to integrate income declarations, payment data, and Common Reporting Standard (CRS) information.
Critically, any future wealth tax is expected to target land and immovable property, minimizing risks of capital flight. With a system that flags discrepancies across global financial data sources, Indonesia’s tax authority is positioning itself to execute surgical audits and investigations.
Nonetheless, Lucas cautioned that false positives—especially involving trusts or “protector” roles—could trigger unnecessary tax authority scrutiny under CRS data interpretations.
Golden Visa Program: A Diamond in the Rough
Indonesia’s Golden Visa regime, designed to attract affluent foreigners, remains underpowered compared to global competitors. Forum attendees flagged structural weaknesses in the cost structure and tenure of the current program—highlighting the UAE as a model for more investor-friendly frameworks.
Unless reformed, Indonesia risks losing its appeal to Asia-Pacific HNWs who now weigh residency programs with increasing sophistication.
Bali as a Financial Hub? The Indonesia Financial Centre (IFC) Vision
In one of the more transformative developments, Lucas confirmed private meetings with key stakeholders concerning the Indonesia Financial Centre (IFC) in Bali—a vision that extends beyond the legal frameworks of Dutch civil, Sharia, or Adat systems.
Early drafts hint at a modern financial jurisdiction with autonomous legal structures—potentially positioning Bali as a wealth magnet similar to Labuan or even DIFC. The initiative signals that Jakarta is not only chasing capital repatriation but aiming to anchor investment vehicles and family offices onshore, with greater legal certainty and competitive structuring options.
Capital Repatriation & the Post-Amnesty Era
There is rising pressure to develop a durable pathway for capital currently parked offshore—especially in Singapore, which holds substantial Indonesian private wealth. Authorities are shifting from one-time amnesties to more permanent, rule-of-law-based vehicles that blend tax transparency with incentives for re-domiciliation.
Yet, this ambition could clash with global anti-avoidance frameworks and OECD oversight, especially as Indonesia finalizes its omnibus regulatory reforms.
Strategic Implications for HNWIs and Advisory Firms
- Global advisors must prepare clients for more granular audits and real-time data sharing under the Core Tax platform.
- Trust structures with Indonesian connections should undergo legal review to mitigate CRS misinterpretation risks.
- Golden Visa stakeholders should monitor regulatory changes, particularly if a Dubai-style overhaul is in motion.
- Indonesia-based family offices and financial firms may find new structuring flexibility if Bali’s IFC is formalized.
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