MSME Legalization: Minister Responds to Thrifting Concerns

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Indonesia Doubles Down on Ban of Imported used Clothing, Despite Calls for Legalization of ‘Thrifting’

Indonesia’s government is reaffirming its prohibition on imported used clothing, despite recent appeals from thrifting businesses to legalize their operations. Officials are distinguishing between the practice of thrifting – buying and selling second-hand goods domestically – and the increasing volume of imported used garments, which they say is a violation of existing trade law.

The debate comes as entrepreneurs in the second-hand clothing market seek clarity and formal recognition for their businesses. A representative of thrifting traders recently voiced concerns to Indonesian lawmakers, arguing that legalization, rather than eradication, is the most viable path forward.

“So, I want to straighten it out, we’re not talking about thrifting. What we’re sorting out is the import of second-hand clothes,” stated minister of Micro, Small and Medium Enterprises (MSMEs) Maman Abdurrahman in Jakarta on Friday, November 21, 2025. “That was first, we’ll straighten it out first. So, as a rule, the import of second-hand items is prohibited.”

Did you know?– Indonesia’s Law Number 7 of 2014 concerning Trade explicitly prohibits the import of used clothing to protect the domestic textile industry. The law aims to foster growth of local manufacturers.

rising Imports Prompt Government Action

According to Maman, the influx of imported used clothing has risen substantially, prompting the government to reinforce the ban outlined in Law Number 7 of 2014 concerning Trade. “In this case, imports of used clothes, graphically, friends already know that there is a very notable increase in volume, imports of used clothes are coming in. That’s why we want to regulate it,” he added.

The government is attempting to mitigate the potential economic impact on thrifting businesses by encouraging a shift towards locally produced goods. Approximately 1,300 Indonesian brands have been identified to supply products to these traders. “in principle, we just have to look for the right substitution format and formulation. We just have to go there,” Maman explained.

Pro tip:– Indonesian MSMEs are encouraged to collaborate with thrifting traders to offer locally-made alternatives. this strategy aims to maintain business viability while adhering to import regulations.

Tax Compliance Not the issue

The Minister of Trade, budi Santoso, further clarified that the prohibition isn’t related to tax evasion.”Used (imported) clothes are prohibited not because they don’t pay taxes. So is it not prohibited to continue paying taxes? No, it’s prohibited because they are used clothes,” Santoso emphasized on Friday, November 21, 2025.

Reader question:– How might the government support thrifting businesses in transitioning to locally sourced products? Share your thoughts in the comments.

A Plea from Thrifting Entrepreneurs

The call for legalization originated with Rifai Silalahi, a thrifting trader at Senen Market, who expressed willingness to comply with tax regulations. Rifai presented his case to the DPR’s Community aspiration Agency (BAM) on wednesday, November 19, 2025, arguing that a legal framework would be a more constructive approach than outright prohibition.

Rifai highlighted the significant number of Indonesians involved in the thrifting industry – approximately 7.5 million people – and warned that a crackdown coudl jeopardize their livelihoods. “What we realy hope is that,like in other developed countries,thrifting is legalized. Why is it legalized in developed countries? Why not in us, sir? As actually we cover almost 7.5 million who are related to thrifting clothing,” Rifai stated at the DPR Building in Central Jakarta on Wednesday, November 19,