Wednesday, 30 April, 2008 | 17:51 WIB
TEMPO Interactive, Jakarta: The Indonesian Tax Legal Aid institution (LBHPI) has eventually been officially launched.
Eddy Mangkuprawira, the Head of LBHPI, said that the establishment of this institution had been ignited by low concern regarding tax legal issues.
“This is a sad situation because tax contributes 70 percent to the state budget,” he said during the LBHPI launching at the Business Center of Allson Apartments, Jakarta, on Wednesday (30/04).
Eddy went on to say that people are currently still reluctant to pay tax, so therefore the tax ratio remains low.
The purpose of LBHPI is to increase people’s awareness about paying tax.
At the present, Indonesia’s tax ratio is 13.5 percent with tax revenues of around Rp600 trillion.
Eddy said that tax ratios in developed countries can reach 40 percent while the average in Asian countries is usually around 20 percent.
“We can achieve revenues of Rp900 trillion with a tax ratio of only 20 percent,” he said.
The government can repay debt and carry out more development.
LBHPI will provide assistance and consultation regarding tax payments.
Eddy said that on average there were 400 legal actions per month taken to court.
Anshari Ritonga, Head of the Tax Court, said he welcomed the establishment of LBHPI.
According to him, this will support the correct implementation of the tax system.
Anshari said he expects LBHPI to increase the awareness of tax payers.