For spa business owners across Indonesia, a sense of relief has finally arrived. The Constitutional Court (MK) has ruled that spa services are part of traditional health care, not entertainment like nightclubs or karaoke. This significant decision spares spa operators from paying entertainment tax, which range from 40% to 75%.
This ruling came after the MK partially granted a judicial review in case No. 19/PUU-XXII/2024 on January 3, 2025. The court’s decision firmly established that steam baths and spas fall under traditional health services. Constitutional Judge Arief Hidayat, while delivering the verdict, explained the rationale behind the ruling.
“The phrase ‘and steam baths/spa’ in Article 55(1)(l) of Law No. 1/2022 is conditionally unconstitutional unless interpreted as part of traditional health service offerings,” Arief declared at the MK Plenary Courtroom in Central Jakarta.
The court criticized the law for categorizing spas alongside entertainment venues like nightclubs and karaoke bars. Such a classification, the MK argued, created legal uncertainty and attached a negative stigma to spas.
“This grouping undermines the identity of spas as traditional health services, leading to public fear and hesitancy in utilizing these facilities,” Arief added.
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Indonesia’s legal framework recognizes traditional health care as a core part of the national health system. Laws such as Law No. 36/2009 and Law No. 17/2023 emphasize its importance, supported by regulations like Government Regulation (PP) No. 103/2014 and PP No. 28/2024. These services promote health while preserving local traditions and cultural values.
Traditional health care encompasses promotive, preventive, curative, rehabilitative, and even palliative efforts. Steam baths and spas, which are rooted in local traditions, align with these principles and contribute to holistic well-being.
The MK highlighted the unique nature of spa services, describing them as holistic health practices that integrate traditional and modern approaches.
“Spa services involve water-based treatments combined with complementary therapies like massage, herbal remedies, aromatherapy, and physical exercises,” Arief noted. “These aim to balance the body, mind, and spirit, achieving optimal health.”
According to the court, spa services can be categorized into two main types. Health and wellness spas focus on promotive and preventive care, while medical spas address curative and rehabilitative needs.
The judicial review stemmed from widespread dissatisfaction with the entertainment tax provisions in Law No. 1/2022 on Financial Relations between Central and Regional Governments (UU HPPD). This law, enacted two years ago, grouped spas with entertainment venues and imposed steep taxes under the Tax on Specific Goods and Services (PBJT), ranging from 40% to 75%.
A total of 22 petitioners challenged Articles 55(1)(l) and 58(2) of the law, arguing that the classification was unfair and damaging to the wellness industry.
The court’s decision marks a turning point for the spa industry, ensuring that its services are recognized for their health benefits rather than being overshadowed by an unjust entertainment tax. This ruling not only protects spa operators from financial strain but also upholds the importance of traditional health care in Indonesia’s cultural and health system.
