Indonesian Customs Authority Dismisses Dozens Over Fraud as Government Threatens Operational Freeze
Indonesia's customs authority has dismissed 27 employees over the past two years for fraud and serious disciplinary breaches, while disciplinary investigations continue against another 33 personnel, officials announced Tuesday in a sweeping crackdown on internal corruption.
The dismissals come as the directorate faces mounting pressure from the country's finance minister, who has warned that further failures could trigger extraordinary measures, including freezing the agency's operations and placing its 16,000 employees on leave.
Background and Context
The enforcement actions against customs staff follow a series of high-profile corruption cases involving officials accused of facilitating under-invoicing schemes that have cost the state billions in lost revenue. According to government statements, the crackdown is part of broader efforts to restore public trust in an agency long plagued by corruption allegations.
The Directorate General of Customs and Excise (DGCE) has faced increasing scrutiny over its performance in protecting state revenue, particularly in detecting and preventing under-invoicing practices where importers declare goods at lower values to reduce duties.
Key Figures and Entities
Nirwala Dwi Heryanto, Director of Communications and Service User Guidance at the DGCE, announced the disciplinary actions during a year-end media briefing in Jakarta. "These actions demonstrate our commitment to firm enforcement against disciplinary violations as part of improving the quality and integrity of our human resources," he stated.
Finance Minister Purbaya Yudhi Sadewa has taken a particularly hard line, issuing a one-year ultimatum for measurable improvements. According to government communications, the minister's warning was issued "in accordance with instructions from President Prabowo Subianto" and includes contingency plans to outsource customs functions to private surveyor institutions should internal reforms fail.
Legal and Financial Mechanisms
The dismissals and ongoing investigations represent the most significant internal enforcement action in recent years at the DGCE. While specific details of the fraud cases were not disclosed, officials indicated that under-invoicing schemes were among the primary violations being targeted.
Looking ahead to 2026, the DGCE has been assigned an increased revenue target of Rp336 trillion (approximately US$20.6 billion), up from the Rp301.6 trillion target for 2025. To achieve this, the agency plans to implement artificial intelligence for customs valuation, modernize laboratory facilities, and expand enforcement operations nationwide.
International Implications and Policy Response
The corruption crackdown at Indonesia's customs authority comes amid growing international concern over trade facilitation and revenue collection in emerging economies. The agency's performance directly impacts Indonesia's trade relationships and customs cooperation agreements with regional partners.
The threat of outsourcing customs functions to private surveyor institutions, as floated by the finance minister, would mark a significant shift in how Indonesia manages its border controls and trade facilitation. Such a move could have implications for international supply chains and customs cooperation programs.
As Indonesia prepares for higher revenue targets including new export duties on gold and coal, the success of these internal reforms will be critical for maintaining investor confidence and ensuring the country's competitiveness in global trade.
Sources
This report draws on official statements from the Directorate General of Customs and Excise, communications from the Indonesian Ministry of Finance, and public declarations regarding customs reform initiatives announced in December 2025.
