Indonesia’s Directorate General of Taxes (DJP) is rolling out a major digital overhaul with its Core Tax Administration System (CTAS), also known as Sistem Inti Administrasi Perpajakan. This initiative aims to modernize the nation’s tax collection and management.
The CTAS implementation sees DJP adopting Commercial Off-the-Shelf (COTS) technology to build a more advanced, data-driven system. This transformation is designed to streamline tax administration processes, boost taxpayer compliance, and optimize state revenue collection.
In this article, LMI Consultancy will provide a detailed breakdown of CTAS and its operational implementation for Indonesian tax compliance.
Coretax in Indonesia: The key goals and benefits of the new Core Tax System (CTAS)
Indonesia is rolling out the Coretax System (CTAS), a new tax administration platform central to the government’s ongoing tax reform efforts.
The Directorate General of Taxes (DGT) highlights five key pillars underpinning this reform:
- Organizational streamlining
- Integrity-driven human resource development
- Data-driven information technology
- Business process simplification, and
- Legal certainty through regulatory simplification.
The technology-driven aspect of this reform has been a gradual process, beginning in 2017 with the phased implementation of electronic tax payments and reporting.
Broader tax reform initiatives in Indonesia, however, date back to 1983, initially focusing on shifting the paradigm for tax officers. This evolved into the modernization of tax administration by 1998.
The DGT continues to drive the digitalization of Indonesia’s taxation landscape through the deployment of CTAS.
Key Objectives
Indonesia’s tax authority is rolling out a significant digital transformation aimed at simplifying tax administration for both the Directorate General of Taxes (DGT) and taxpayers. This initiative, detailed in Presidential Regulation No. 40 of 2018 on Tax Administration System Modernization, seeks to achieve several key objectives:
- Strengthen tax institutions: Build a robust, credible, and accountable tax body with efficient operations.
- Optimize inter-agency synergy: Foster better collaboration between government entities.
- Boost taxpayer compliance: Enhance adherence to tax regulations.
- Increase state revenue: Drive higher national income.
Benefits
A central component of this overhaul is the Core Tax Administration System (CTAS), designed to deliver immediate benefits:
- Simplicity: Achieved through an omnichannel and borderless approach.
- Practicality: Universal system usage streamlines processes.
- Speed: Integrated data and systems accelerate operations.
- Effectiveness: Easy system access improves overall efficiency.
The CTAS marks a significant departure from previous systems by introducing a fully automated and integrated platform, fundamentally simplifying tax administration.
Practical examples of CTAS implementation include:
Taxpayer data integration: Linking DGT systems with population registration data, utilizing the National Identity Number (NIK) as the Taxpayer Identification Number (NPWP).
End-to-end tax functions: Covering everything from tax audits and collections to taxpayer accounting and other taxpayer activities.
Key Changes of the Coretax system in 2025
| Service Type | Coretax (New System) | Previous System |
| Taxpayer Registration | – Available through various service channels (omnichannel)
– Accurate validation – Simple process – Integrated data |
– Only through website & service counters
– Limited data validation – Lengthy process – Data not integrated |
| Information Services | – Accessible via TAM on the Taxpayer Portal
– Can be accessed anytime – Real-time data includes taxpayer profile, rights & obligations, tax ledger, and transaction history |
– Only accessible through DJP Online portal
– Limited info: basic taxpayer profile & reporting history |
| Tax Payment | – Multi-Account Payment: pay different taxes using a single billing code
– Deposit Account: store balance to pay multiple tax obligations – Online Refunds: interest rewards & tax refunds processed in real-time – Tax Obligation Data Feature: view outstanding taxes & auto-generate billing codes |
– Must use separate billing codes for each tax
– Manually search for unpaid tax types – Refunds not online – No feature to view outstanding taxes |
| VAT Periodic Tax Return (SPT Masa PPN) | – Installment calculation for Article 25 Income Tax
– PBB SPOP data available – All VAT return menus accessible for all taxpayer types – NSFP auto-generated in one app – Automatic input tax compensation |
– Requires multiple apps for reporting
– NSFP request is separate from VAT filing system |
| Employee Income Tax Return (SPT Masa PPh) | – Uses Average Effective Rate (TER)
– No need to update app when system changes – Headquarters can file/pay SPT, branches can issue withholding slips – Unified PPh withholding data integrated with e-Bupot – Billing codes for all PPh SPT types managed in one system |
– SPT PPh 21 & Unified PPh reported separately
– Withholding data not integrated – Billing code creation done in separate app |
| Annual Income Tax Return (SPT Tahunan) | – Corporate: starts from main form, then appendices
– Standardized & integrated profit/loss format – Withholding slips automatically recorded in return – Individuals: simplified with only 1 form – Individual taxpayer withholding slips auto-loaded into the system |
– Withholding slips not integrated
– Profit/loss format not standardized – MSMEs meeting certain criteria exempt from annual |
How does the implementation of Core tax work?
The DGT has conducted rigorous system integration, functional verification, and non-functional testing to ensure the system meets stringent quality standards. The CTAS implementation marks a significant step in modernizing Indonesia’s tax framework.
Below is an overview of the core tax system’s business processes for tax administration, based on information from the DGT’s official social media account, @DitjenPajakRI:
1. Taxpayer Registration (Ensure NPWP/NIK Ownership)
Before registering as a taxpayer, individuals or entities must possess a Taxpayer Identification Number (NPWP), or a National Identity Number (NIK) for Indonesian citizens and certain foreign nationals. NPWP acquisition channels include:
- Application Service Providers (PJAP)
- Online Single Submission (OSS): For individual entrepreneurs.
- Integrated Ministry of Law and Human Rights Channels: For legal entities or business entities.
- Indonesian/Foreign Citizens with NIK: Activation of NIK to serve as NPWP.
- Foreign Citizens Without NIK: NPWP registration requires passport validation from the Directorate General of Immigration, leading to a new NPWP issuance.
- Legal Entities (PT, PP, Foundations, Associations, Cooperatives): NPWP acquisition via the Legal Entity Administration System (SABH) of the Directorate General of General Legal Administration (AHU).
- Business Entities (CV, Firms, Civil Partnerships): NPWP acquisition via the SABH system of the Directorate General AHU.
- Branch Offices: Assigned a Branch Activity ID (NITKU) or business activity location identity.
- Government Agencies: Registration available via 3C channels or other designated channels. Central Government Agencies require validation of work unit codes with the Directorate General of Treasury.
- Other Entities: For registration challenges or entities not covered above, registration can be done via 3C channels (pajak.go.id website, Kring Pajak 1500200 call center, Post/Counter at Tax Service Offices/Extension Offices) with validation of the Ratification Decree.
2. Taxpayer Account Activation
Upon obtaining an NPWP, taxpayers must activate their accounts via the DGT website or by visiting a Tax Service Office/Extension Office:
- Verification Process: Account activation involves OTP verification via phone number and email.
- Identity Verification: NIK-holding taxpayers undergo face recognition, while non-NIK taxpayers require photo verification.
- Approval/Rejection: Applications are processed within 1 business day after BPE/BPS (Electronic Proof of Submission/Receipt), resulting in account activation or a rejection notice.
- Limited Access: Taxpayers who do not activate their accounts can still perform limited tax activities.
3. Electronic Signature Preparation
- Electronic Signatures (TTE) are mandatory for signing taxpayer documents, encompassing:
- Non-Certified TTE (DGT Authorization Code): Taxpayers create a passphrase or security code.
- Certified TTE (Digital Certificate): Integrated with Indonesian Electronic Certificate Providers (PSrE). To obtain a Digital Certificate, applications must be submitted via the DGT website or directly at a Tax Service Office/Extension Office.
- Automatic Issuance: Digital certificates are automatically issued upon meeting PSrE requirements.
4. Data & Status Changes Taxpayers can update their data and status as needed:
- Channels: Changes can be made via 3C channels.
- Modifiable Data: Includes taxpayer identity & profile, and Land and Building Tax (PBB) object data.
- Status Changes: Covers active/inactive taxpayer status, domestic PMSE VAT collection status, stamp duty collection status, eligibility to be appointed as representative, PPh/PPN withholding/collection agent, and reporting/non-reporting financial institution status.
- Processing: Some changes are processed directly by the system, while others require further review.
5. Taxpayer Relocation & NPWP Deletion
- Relocation: Taxpayers can request relocation through 3C channels if their administrative region changes. The DGT issues a relocation approval or rejection letter within 5 business days.
- NPWP Deletion: An NPWP can be deleted if the taxpayer no longer meets the subjective and/or objective requirements as per tax laws.
- Deletion Process: Requests can be made via 3C channels.
- Processing Time: NPWP deletion takes up to 6 months for individual taxpayers and 12 months for corporate taxpayers.
- Outstanding Taxes: If outstanding tax obligations exist, a rejection letter for NPWP deletion will be issued, granting 30 days for payment. Upon settlement, the deletion letter will be issued. If not settled, the NPWP remains active.
How to Pay Taxes through the New Coretax Administration System (CTAS)
Here’s an overview of the streamlined tax payment process within the new core tax administration system:
- Tax payments are now consolidated into a single application, thanks to the seamless integration between perception banks and the Directorate General of Taxes (DGT) systems.
- A single billing code facilitates payment for one or multiple tax periods and assessments, eliminating the need for individual billing codes for each tax obligation.
- A new tax deposit account feature allows taxpayers to pre-fund their tax obligations, ensuring sufficient balance to avoid late payment penalties.
The system also offers instant online processing for interest refunds and accelerated tax overpayment returns. Furthermore, an automated feature displays outstanding tax bills directly to taxpayers.
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