Indonesia to classify ride-hailing drivers as micro entrepreneurs under planned regulation

Indonesia's government is preparing to classify ride-hailing drivers as micro entrepreneurs, a move that would extend a range of tax incentives, financing opportunities and business development programmes to millions of platform workers.

The policy is being drafted through a Presidential Regulation (Perpres), according to minister of MSMEs Maman Abdurrahman. Once enacted, registered online motorcycle taxi drivers would automatically be recognised as micro entrepreneurs.

The proposal marks a significant shift in how Indonesia views gig economy workers, positioning them not only as platform partners but also as business owners eligible for government-backed MSME support.

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Under the planned regulation, drivers would gain access to incentives already available to micro enterprises, including income tax exemptions for businesses with annual turnover of up to IDR 500 million (US$28,000). As most ride-hailing drivers earn below that threshold, they would qualify for the tax relief.

Beyond tax benefits, drivers would also be eligible for government empowerment programmes covering financing, business capacity building and entrepreneurship training.

The ministry is currently working with ride-hailing platforms and driver associations to prepare the implementation of the policy.

Abdurrahman said the new classification would not change drivers' existing work arrangements. Instead, it is intended to encourage them to build additional businesses alongside their ride-hailing activities, including ventures that could be operated by family members to generate supplementary income.

The ministry and platform companies are also developing programmes to identify suitable business opportunities that drivers could pursue.

This marks the latest intervention by the Indonesian government to strengthen protections for gig workers. Previously, President Prabowo Subianto ordered platform companies to cap commissions at 8%, guaranteeing drivers at least 92% of fares, while introducing mandatory labour protections including workplace accident insurance and access to public healthcare.

Discover what's next in Indonesia's fast-moving digital landscape at DMA Indonesia 2026 on 13 October in Jakarta, where marketing leaders will explore how AI, creator ecosystems, social commerce, and omnichannel strategies are reshaping customer engagement and business growth.

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