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Bribery, Gratuities, and Deductible Expenses under Article 20A of PP 20/2026

Probosuko Adji Irfansah

PP 20/2026 states that bribes, gratuities, and corruption-related payments cannot be deducted from gross income. This article reads the issue practically so business owners can prepare their tax position before year-end.

This article is based on the IKPI seminar material on Government Regulation No. 20 of 2026 and the PP 20/2026 FAQ module. The official regulation is Government Regulation No. 20 of 2026, effective 22 April 2026.

Quick Take

  • Payments related to bribery, gratuities, corruption, or foreign public officials are not deductible for tax purposes.
  • The rule strengthens tax integrity and governance standards.
  • A nominative list is not a tool to legalize bribery.
  • Companies should tighten approval for marketing, entertainment, and facilitation payments.

Practical Impact

  • The decision to use the 0.5% final tax must be supported by calculation, not assumption.
  • Bookkeeping becomes the main control to prove source and character of income.
  • Structures that used to be efficient should be retested against aggregation and exclusion rules.

Common Misreadings

  • Do not look only at one entity’s revenue.
  • Do not treat all digital income as the same.
  • Do not wait for a tax letter before organizing documents.

Action Checklist

  • List taxpayer status and all income sources.
  • Calculate last-year gross revenue on an aggregated basis.
  • Check transitional rules and facility periods.
  • Prepare bookkeeping or net-income norm analysis according to income character.

Simple Example

An expense labelled as a “project commission” is not automatically deductible. If its substance is bribery or gratuity, it must be excluded from fiscal deductions and may trigger other legal risks.

Need to map PP 20/2026 exposure for your business? Arunika Consulting can help review taxpayer status, revenue aggregation, and bookkeeping transition before the issue appears in the annual tax return. Contact us.

Note: this content is educational. Final tax treatment must be tested against the taxpayer facts, transactions, regulatory text, and implementing rules.