Honda Says Income Tax Abolition Could Boost Car Sales

KatadataOTO – The government has eliminated taxes for people with salaries under IDR 10 million. This is stated in the Minister of Finance Regulation (PMK) Number 105 of 2025 concerning Article 21 Income Tax on Certain Incomes Borne by the Government in the Context of the 2026 Fiscal Year Economic Stimulus.

This policy has received a positive response from industry players. This is because the regulation has the potential to increase public purchasing power.

By not paying income tax, people will be motivated to spend their money in various sectors. One of them is four-wheeled vehicles.

“This government policy certainly helps increase public purchasing power, especially in the middle-income segment. The impact may not be felt immediately, but it has the potential to encourage interest in purchasing vehicles,” said Yusak Billy, Sales & Marketing and After Sales Director of PT Honda Prospect Motor, to KatadataOTO (07/01).

Photo: Courtesy

He added that in this segment, many people are indeed looking for their first car. Therefore, affordable vehicles like LCGCs can be a top choice.

“This policy has the potential to make it easier for those who need an affordable, efficient vehicle with good resale value,” he added.

Honda itself has several models to choose from. One of them is the Brio, which has been the backbone of sales in recent times.

Based on Gaikindo data, the Honda Brio has shipped at least 31,068 units to its entire network in Indonesia.

Honda Sales January – November 2025

The new car market in Indonesia experienced pressure throughout 2025. This situation had a direct and significant impact on Honda.

Based on Gaikindo data, the Japanese manufacturer was only able to sell 64,225 units to consumers from January to November 2025. This number is much smaller than the achievement in the same period the previous year, which reached 92,327 units.

Photo: HPM

The manufacturer only managed to capture 8.7 percent of the total market. That figure is down from the previous year's 11.4 percent.

Meanwhile, for wholesales, Honda also experienced pressure. From January to November 2025, they only recorded a figure of 53,301 units.

Whereas in the same period the previous year, Honda was still able to record a figure of 86,350 units.