The rising popularity of padel among urban residents has not only driven up rental demand and costs but also sparked fresh debate: why is there a 10% entertainment tax on this trending sport?
Head of the Jakarta Provincial Revenue Agency, Lusiana Herawati, stepped in to explain the policy. “There’s no need to worry. Keep exercising for your health, and let’s work together to pay taxes for the greater good,” Lusiana said in a written statement on Friday (July 4, 2025). She emphasized that fairness and transparency remain the foundation of tax collection, and all revenue will be used to benefit the public.
While many were surprised, the tax itself isn’t new. Entertainment tax has existed for years under Law No. 19 of 1997, as part of local tax contributions that help fund public services and development. Padel and similar sports aren’t classified as luxury entertainment, so the tax is capped at 10%, which is actually lower than the 11% VAT. Only exclusive luxury entertainment, which the government sees as needing consumption control, can be taxed up to 75%.
The Jakarta Provincial Government clarified these rules further through Regional Regulation No. 1 of 2024. It states that renting sports spaces and equipment—including gyms, futsal courts, tennis courts, and swimming pools—is subject to PBJT (Regional Tax on Goods and Services). Jakarta Revenue Agency Decree No. 257 of 2025 then lists the specific sports activities that fall under this tax.
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The decree covers fitness centers like yoga, pilates, and zumba, as well as boxing gyms, athletics facilities, jet skiing, and padel courts. So far, by mid-2025, seven padel courts in Jakarta have officially registered as PBJT taxpayers.
Lusiana stressed the tax is about fairness, as other similar sports activities have long been taxed under entertainment tax. The aim is to ensure equal treatment rather than discourage people from staying active. In the end, as demand for padel courts continues to soar despite high rental fees, the tax revenue collected will flow back into public services—helping the very communities who love the sport.
