Bali PFII site still under evaluation, Airlangga says

Jakarta — Indonesia has yet to fix a site in Bali for its planned Indonesia International Financial Center, with the government still evaluating land options including a plot owned by investment management entity Danantara, Coordinating Minister for Economic Affairs Airlangga Hartarto said on Thursday, 20 August 2026, in remarks published on 19 September 2026.

Airlangga said the Bali location for the Pusat Finansial Internasional Indonesia (PFII) remains under review, even though the island has been designated as one of the development areas for the financial hub, according to reports citing his comments at the Coordinating Ministry for Economic Affairs in Jakarta.

"Bali is still in the evaluation stage," Airlangga said, according to Tempo and local economic media, when asked about the PFII site after a meeting at his office.

Jakarta to host initial operations

While Bali is being prepared as the main development location, Jakarta is expected to host initial PFII operations.

Airlangga and other officials have previously indicated that PFII activities would start from an office in Jakarta, including the Danareksa building, before the center is fully developed in Bali over a two-to-three-year period, according to specialist investment and tax publications.

Legal and policy analyses of the PFII law note that President Prabowo Subianto has publicly indicated Jakarta as the initial PFII location, with Bali envisaged as a future site and additional locations potentially considered over time.

The government has named Bali as a PFII development area, but has not yet announced a final site on the island.

According to Indonesian media reporting on Airlangga’s latest comments, one of the plots under evaluation in Bali is owned by Badan Pengelola Investasi Daya Anagata Nusantara (Danantara), while other areas such as North Bali, Kura Kura and Sanur have been mentioned more broadly in public debate as potential locations.

Airlangga did not specify which of those locations, if any, is currently being considered by the government, and said he had not yet examined the Bali site options in detail.

Regulatory timetable and scope

The PFII law, passed in July 2026, establishes a special jurisdiction intended to host international-standard financial, investment and professional services.

The implementing government regulation (peraturan pemerintah, or PP) on PFII and its tax incentives has been slated to be completed before 16 August 2026, according to earlier statements by Airlangga reported by domestic tax news outlets.

However, in his August comments on the Bali site, Airlangga indicated he had not yet reviewed the technical regulation in detail and did not provide a fresh timetable for its completion.

The PFII framework is designed to cover a wide range of financial sector activities, including banking, insurance, capital markets, derivatives, carbon trading, bullion and financial technology, as well as Islamic finance.

It also aims to accommodate family offices, treasury hubs and asset management businesses, positioning the center as a regional base for global capital.

Incentives for investors and professionals

The PFII law offers extensive incentives to attract international investors and skilled professionals.

According to legal and tax analyses of the legislation, qualifying businesses operating in the PFII may receive a 100 percent reduction in corporate income tax for defined periods, alongside exemptions for certain foreign-sourced income and relief from withholding taxes.

Foreign financial-sector professionals working within the zone can benefit from full personal income tax exemption on qualifying PFII income, while foreigners holding golden visas tied to the center are to be treated as non-resident tax subjects for the duration of their visas.

The law also allows exemptions from value-added tax, luxury-goods tax and import duties for qualifying activities, with further fiscal incentives to be set out in future regulations.

Officials and legal commentators say the government’s package for PFII includes guarantees for capital and profit repatriation, selected tax facilities, golden visas and streamlined licensing, combined with strict compliance standards meant to reassure international investors.

For Bali, the outcome of the site review is seen as significant for investment, property and professional services expectations.

For now, however, Airlangga’s latest remarks underscore that the Bali component of PFII remains in the evaluation phase, with the government yet to announce a specific plot or begin physical development of the financial center on the island.

Sources

• Tempo.co (English edition)
• Pantau.com
• Rajah & Tann Asia – "Indonesia Establishes its International Financial Centre: An Introduction to the PFII Law"
• The Business Times (Singapore) – "Indonesia offers sweeping tax breaks under new financial centre law"