Digital Governance for Confiscating Crypto-Assets to Settle Tax Liabilities in Indonesia
Article Sidebar
-
Taxation, Cryptocurrency, Digital Asset, Confiscation, Asset Recovery
Abstract
The emergence of digital and virtual assets has created new challenges for tax authorities, as taxpayers now possess not only traditional but also digital assets that can be accessed globally through the internet. This unconventional form of asset ownership raises questions about how tax authorities can effectively confiscate and liquidate crypto-assets to resolve tax liabilities. The lack of these mechanisms complicates tax administration and criminal law enforcement in the digital era. This study aims to examine the possibility of confiscating digital and virtual assets for tax purposes within Indonesia’s asset recovery framework. Using a comparative law approach, this article analyzes the potential use of crypto-asset confiscation for the settlement of tax arrears by referencing the latest European Union regulations on asset recovery and confiscation, particularly the Directive (EU) 2024/1260 of the European Parliament and Council on asset recovery and confiscation. The analysis shows that Indonesia currently lacks a system that enables the confiscation and recovery of digital assets for tax enforcement. Considering the shared civil law foundations and similar challenges faced by EU countries, the EU’s model provides a relevant reference point. Indonesia should consider adopting the European Union’s methodology for seizing and recovering digital assets to enhance its legal framework. Implementing the asset recovery and confiscation mechanisms established under Directive (EU) 2024/1260 could serve as a paradigm for Indonesia to efficiently confiscate taxpayers’ assets and strengthen tax compliance in the digital economy.
Full text article
References
[1] R. S. Avi-Yonah and M. Salaimi, “A new framework for taxing cryptocurrencies,” The Tax Lawyer, vol. 77, no. 1, 2023.
[2] S. Bakradze, “To tax or not to tax or how to tax: Tax policy and its role in cryptocurrency adoption,” Rich. JL & Tech., vol. 28, p. 340, 2021.
[3] N. P. L. Santoso, R. Nurmala, and U. Rahardja, “Corporate leadership in the digital business era and its impact on economic development across global markets,” IAIC Transactions on Sustainable Digital Innovation (ITSDI), vol. 6, no. 2, pp. 188–195, 2025.
[4] K. Becker, “Blockchain matters—lex cryptographia and the displacement of legal symbolics and imaginaries,” Law and Critique, vol. 33, no. 2, pp. 113–130, 2022.
[5] T. Chan, “The nature of property in cryptoassets,” Legal studies, vol. 43, no. 3, pp. 480–498, 2023.
[6] S. Bilek-Steindl, C. Kettner, and C. Mayrhuber, “Sustainability, work and growth in the context of sdg 8,” Empirica, vol. 49, no. 2, pp. 277–279, 2022.
[7] S. Milton, “Higher education and sustainable development goal 16 in fragile and conflict-affected contexts,” Higher Education, vol. 81, no. 1, pp. 89–108, 2021.
[8] H. Najwa, I. Sidharta, D. B. Annisa, and R. Y. Astuti, “Effect of tax collection by force letter on corporate income tax revenue,” Acman: Accounting and Management Journal, vol. 4, no. 2, pp. 200–211, 2024.
[9] D. Bennet, L. Maria, Y. P. A. Sanjaya, and A. R. A. Zahra, “Blockchain technology: Revolutionizing transactions in the digital age,” ADI Journal on Recent Innovation, vol. 5, no. 2, pp. 192–199, 2024.
[10] E. D. Chason, “Crypto assets and the problem of tax classifications,” Wash. UL Rev., vol. 100, p. 765, 2022.
[11] J. Wilson and E. Erika, “Empowering eco-innovation through digitalization in startup enterprises,” Startupreneur Business Digital (SABDA Journal), vol. 4, no. 2, pp. 146–154, 2025.
[12] M. Durdu and ¨U. S. ¨Ust¨un, “Taxation of crypto assets: The example of us federal income tax,” in Annales de la Facult´e de Droit d’Istanbul, no. 74. Istanbul University, 2024, pp. 19–40.
[13] A. Ferreira, “The curious case of stablecoins-balancing risks and rewards?” Journal of International Economic Law, vol. 24, no. 4, pp. 755–778, 2021.
[14] P. Wulandari and M. Sudarma, “The influence of ownership structure, leverage, profitability, company size, and audit quality on tax avoidance in indonesia,” in Brawijaya International Conference on Economics, Business and Finance 2021 (BICEBF 2021). Atlantis Press, 2022, pp. 228–234.
[15] L. Larisang, S. Sanusi, M. A. Bora, and A. Hamid, “Practicality and effectiveness of new technopreneurship incubator model in the digitalization era,” Aptisi Transactions on Technopreneurship (ATT), vol. 7, no. 2, pp. 318–333, 2025.
[16] D. Goldbarsht, “Adapting confiscation and anti-money laundering laws to the digital economy: exploring the australian interplay between proceeds and technology,” Journal of Money Laundering Control, vol. 27, no. 3, pp. 472–488, 2024.
[17] S. Hadiyantina, D. Cahyandari, B. U. Annafi, and N. Ramadhan, “The tendencies of cryptocurrency policies in indonesia: Taxation and investment law review,” Lentera Hukum, vol. 11, p. 257, 2024.
[18] D. Novitasari, F. S. Goestjahjanti, U. Rahardja, S. Santoso, S. V. Sihotang, N. A. Santoso, and G. P. Cesna, “Optimizing msme performance through marketing capabilities and digital marketing adoption,” in 2025 4th International Conference on Creative Communication and Innovative Technology (ICCIT). IEEE, 2025, pp. 1–7.
[19] M. I. Inozemtsev, “Digital law: The pursuit of certainty,” p. 8, 2021.
[20] F. Irawan and I. A. Ulinnuha, “Transfer pricing aggressiveness in indonesia: Multinationality, tax haven, and intangible assets,” Jurnal Dinamika Akuntansi Dan Bisnis, vol. 9, no. 1, pp. 1–18, 2022.
[21] L. Lee, “Examining the legal status of digital assets as property: A comparative analysis of jurisdictional approaches,” arXiv preprint arXiv:2406.15391, 2024.
[22] E. Sugiharto and V. U. Tjhin, “Understanding the key drivers behind user selection of digital banks,” International Journal of Cyber and IT Service Management (IJCITSM), vol. 5, no. 2, pp. 171–185, 2025.
[23] J. Morgan, “Systemic stablecoin and the brave new world of digital money,” Cambridge Journal of Economics, vol. 47, no. 1, pp. 215–260, 2023.
[24] N. Naibaho, H. Harkrisnowo, S. Ar, and A. G. Wibisana, “Criministrative law: Development and challenges in indonesia,” Indon. L. Rev., vol. 11, p. 1, 2021.
[25] S. Martinez, J. C. Rodr´ıguez, and S. Lestari, “Exploring digital circular economy principles in educational institutions,” International Transactions on Education Technology (ITEE), vol. 3, no. 1, pp. 17–25, 2024.
[26] F. M. Nelson, M. D. Prosperiani, C. R. Ramadhan, and P. P. Andini, “Cracking the code: Investigating the hunt for crypto assets in money laundering cases in indonesia,” Journal of Indonesian Legal Studies, vol. 9, no. 1, pp. 89–130, 2024.
[27] A. Sakellaraki, “Eu asset recovery and confiscation regime–quo vadis? a first assessment of the commission’s proposal to further harmonise the eu asset recovery and confiscation laws. a step in the right direction?” New Journal of European Criminal Law, vol. 13, no. 4, pp. 478–501, 2022.
[28] S. Salisu, V. Filipov et al., “Blockchain forensics: A modern approach to investigating cybercrime in the age of decentralisation,” in # PLACEHOLDER PARENT METADATA VALUE#, vol. 18. Academic Conferences International Limited, 2023, pp. 338–347.
[29] A. van der Merwe, “A taxonomy of cryptocurrencies and other digital assets.” Review of Business, vol. 41, no. 1, 2021.
[30] N. Lutfiani, N. Fauziyah, F. P. Oganda, R. Setyaningrum, E. A. Natalia et al., “The role of globalization in indonesian evolution influence on media digital literacy language ai,” International Transactions on Artificial Intelligence, vol. 3, no. 2, pp. 192–200, 2025.
[31] C. Carmen-Cristina, “Revision of the eu rules on asset recovery and confiscation,” 2023.
[32] D. Oktobrian, F. A. Basuki, and E. S. Lumempow, “Projection of asset forfeiture draft law in response to asset recovery for victims of investment crime,” The Prosecutor Law Review, Vol. 2, No. 2, Aug 2024, proyeksi Rancangan Undang-Undang Perampasan Aset.
[33] L. Mery, A. S. R. Wulandari, P. Patawari, and N. Nurmiati, “Indonesia’s strategic role in the development of international law in the asean community,” Tirtayasa Journal of International Law, vol. 3, no. 1, pp. 33–69, 2024.
[34] M. S. Mansyah et al., “Legal protection for victims of fraud in online buying and selling transactions from the perspective of islamic law,” Justice Law Review, vol. 1, no. 1, pp. 37–65, 2025.
[35] J.-P. Brun, A. Sotiropoulou, L. Gray, C. Scott, and K. M. Stephenson, Asset recovery handbook: A guide for practitioners. World Bank Publications, 2021.
[36] R. Aprianto, C. Lukita, A. Sutarman, R. A. Sunarjo, R. N. Muti, and E. Dolan, “Facing global dynamics with effective strategy: A tasted organizational change management approach,” International Journal of Cyber and IT Service Management, vol. 5, no. 1, pp. 1–11, 2025.
[37] A. Faturahman, N. S. Lubis, N. P. L. Santoso, A. Adiwijaya, M. Madisson et al., “Impact of blockchain enhanced digital marketing on brand awareness of solar panels,” Blockchain Frontier Technology, vol. 5, no. 1, pp. 1–12, 2025.
[38] D. S. Bikelis, D. Pranka, and G. Dainauskait˙e, “Penal vs. confiscation-only approaches in money laundering control,” Baltic Journal of Law & Politics, vol. 17, no. 2, pp. 10–2478, 2024.
[39] E. Rifai and H. Tisnanta, “Role of law enforcement to prevent cyber laundering and asset recovery from overseas,” International Journal of Cyber Criminology, vol. 16, no. 1, pp. 110–122, 2022.
[40] J. Coghlan, “Sec lawsuits: 68 cryptocurrencies are now seen as securities by the sec,” 2023.
[41] D. Nurferyanto and Y. Takahashi, “Combating tax crimes in indonesia: tackling the issue head-on,” Humanities and Social Sciences Communications, vol. 11, no. 1, pp. 1–14, 2024.
[42] F. Fang, C. Ventre, M. Basios, L. Kanthan, D. Martinez-Rego, F. Wu, and L. Li, “Cryptocurrency trading: a comprehensive survey,” Financial Innovation, vol. 8, no. 1, p. 13, 2022.
[43] A. Legislativa, “El salvador: Primer pa´ıs del mundo en reconocer al bitcoin como moneda de curso legal,” Asamblea. gob, 2021.
[44] U. Securities, E. Commission et al., “Statement on digital asset securities issuance and trading,” URL: https://goo.gl/4ZvqMp.
[45] L. Sulastri, B. Efendi, and G. Gumilar, “The politics of asset confiscation law in indonesia,” Lex Publica, vol. 10, no. 1, pp. 43–65, 2023.
[46] A. Gunawan, W. Hasyim, M. Putih, T. W. Wirjawan, I. A. Gopar, and S. Stephanie, “A comprehensive bibliometric study of digital leadership influence on technopreneurial success,” Aptisi Transactions on Technopreneurship (ATT), vol. 7, no. 2, pp. 492–502, 2025.
[47] N. Rizqiyanto, M. Rizqi, F. A. R. Afsa, and B. Berrahlia, “Tax regulation challenges in the digital economy era: Legal analysis and implications in indonesia,” Trunojoyo Law Review, vol. 7, no. 1, pp. 65–102, 2025.
Authors
Copyright (c) 2025 Albert Richi Aruan, Kurnia Toha, Aad Rusyad Nurdin
This work is licensed under a Creative Commons Attribution 4.0 International License.
This journal permits and encourages authors to post items submitted to the journal on personal websites while providing bibliographic details that credit its publication in this journal.
Authors are permitted to post their work online in institutional/disciplinary repositories or on their own websites. Pre-print versions posted online should include a citation and link to the final published version in Journal of Librarianship and Scholarly Communication as soon as the issue is available; post-print versions (including the final publisher's PDF) should include a citation and link to the journal's website.