Indonesia's Finance Minister, Purbaya Yudhi Sadewa, is targeting the implementation of incentives for electric vehicles (EVs), including electric motorcycles and cars, from June 2026 in an effort to reduce fuel consumption.

"We will calculate and prepare the budget. What is clear is that implementation is targeted to begin in early June," he said during a press conference held by the Financial System Stability Committee (KSSK) in Jakarta on 7th May.

Purbaya stated that the objective of the EV incentive policy is to encourage a shift in consumption patterns from fuel to electricity. According to him, the policy is expected to help reduce Indonesia's imports of fuel and crude oil.

"This will help strengthen economic resilience. The focus should not be solely on the subsidy itself. The primary objective is to make the economy more resilient from an energy perspective," Purbaya said.

He stated that the government is preparing EV incentives for 100,000 electric cars and 100,000 electric motorcycles in 2026. For electric motorcycles, the government has allocated IDR 5 million (US$ 290) per unit. Meanwhile, electric cars will receive government-covered value-added tax (VAT) incentives ranging from 40% to 100%.

The VAT incentives apply only to EVs and do not cover hybrid vehicles. The level of incentives will depend on the type of battery used, including nickel-based and non-nickel batteries.

"For cars, the incentives will vary. Some will receive 100-percent VAT coverage, while others will receive 40%. It depends on the battery," Purbaya said.

He had previously stated that nickel-based EVs would receive larger subsidies as part of efforts to support nickel, one of Indonesia's key commodities.