Finance Minister Purbaya Yudhi Sadewa has firmly rejected the idea of using Indonesia’s state budget (APBN) to fund the establishment of a family office in the country. The proposed family office project is known to be one of the flagship initiatives of the National Economic Council (DEN) Chairman, Luhut Binsar Pandjaitan.

Purbaya emphasized that no portion of the APBN will be redirected to finance the creation of a family office. He stated that if DEN wishes to move forward with the plan, it should do so independently and without relying on state funds.

“I’ve heard about that issue for quite some time, but let it be. If DEN can build it on their own, then go ahead. I will not allocate any budget for that purpose,” Purbaya said at the Head Office of the Directorate General of Taxes (DJP).

The minister reiterated that the APBN must remain focused on targeted and essential programs, aiming to ensure efficiency and prevent potential budget misallocation or leakage. He stressed the importance of directing public funds toward initiatives that yield real benefits for the people.

But what exactly is a family office?

In essence, a Wealth Management Consulting (WMC) or family office is a private wealth management and advisory firm designed to serve high-net-worth individuals and families. The concept allows ultra-rich individuals and major global investors to allocate their funds in Indonesia with significant tax advantages or even tax exemptions.

The idea of establishing a family office in Indonesia was first proposed by Luhut Binsar Pandjaitan during his tenure as Coordinating Minister for Maritime Affairs and Investment under the administration of Indonesia’s 7th President, Joko Widodo. Discussions on the initiative have been ongoing since 2024.

The project was initially scheduled to begin implementation in February 2025, though it remains in the preparatory phase. Luhut previously affirmed that the family office initiative would continue under President Prabowo Subianto’s administration, with the goal of launching operations within this year.

“I believe the project is still progressing, and we are continuing to pursue it. We hope the President can make a final decision soon,” Luhut said at the Indonesia Stock Exchange (IDX) Building, Jakarta, on Monday (July 28, 2025).

He further mentioned that the establishment of the family office is now in its finalization stage, and that the government has sought advice from Ray Dalio, the renowned American investor and founder of Bridgewater Associates, the world’s largest hedge fund.

However, with Finance Minister Purbaya’s clear refusal to involve the state budget in the project, uncertainty now looms over the future of this initiative led by the DEN Chairman.