Sat, 18 Jul 2015
Indonesia is set to miss ambitious tax revenue targets this year, according to the country’s finance minister, as the new government comes under pressure to raise public spending and revive growth in Southeast Asia’s largest economy.

The administration will undershoot its Rp1,294tn ($96.8bn) goal for tax collection by as much as Rp120tn, according to finance minister Bambang Brodjonegoro, who has led an aggressive push to broaden the tax base since taking office in October.

“What we need to improve is the compliance,” he said. “Growth doesn’t translate into tax revenue in a proportional way, which means there is a big problem with our tax administration.”

Mr Brodjonegoro estimates that there are just 27m registered taxpayers in the country out of a population of 255m, with 10m of those paying income tax in full every year. There is much room to improve compliance, he said, with widespread tax evasion across the spectrum from individual workers to big business.

“Big companies with a big profile — their tax record is quite poor, meaning they are far from 100 per cent compliant,” the finance minister added. “There is a reason that we squeeze them.”

In its revised budget earlier this year, the new administration announced plans to raise tax collection by 30 per cent and ramp up public sector investment.

Yet, as growth slows and ministries struggle to make use of their public sector budgets, the finance minister forecasts a budget deficit of 2.2 per cent of gross domestic product this year, exceeding the 1.9 per cent target.

As part of its push to raise tax revenues, Indonesia has offered to waive penalties on unpaid taxes from the past five years for those that repay the full amount this year.

The new administration has also handed out hefty fines and arrested a series of senior executives in recent tax cases, as well as introducing electronic tax return submission in an attempt to control fraud.

“If we say we need to hold or delay the tax reform until the [economy is in a] better condition I am sure it won’t happen,” Mr Brodjonegoro added.

Economists have long said the government will struggle to raise tax collection as the Indonesian economy grows at its slowest pace since 2009, weighed down by the fall in oil and gas prices.

Recent moves to raise tax revenues could also be poorly timed as Indonesia looks to boost infrastructure investment, according to Harry Su, head of research at Bahana Securities, the Jakarta-based brokerage.

“The government’s aggressive tax drive is putting off capital expenditure, it’s putting off investment as well,” he said.

Meanwhile, plans to introduce an amnesty from prosecution on certain financial crimes including corruption and money laundering in return for repatriating assets and paying taxes on them are also being discussed, said the finance minister.

“We are not asking you whether the money is from illegal things or legal things — we don’t care as long, as you declare that as income,” the finance minister said. “The more important thing is to bring back Indonesian money onshore.”





News Search/Filter
Transaction Rates
16 Aug 18
Buy
Sell
AED1
3,904.98
3,904.98
AFN1
196.77
196.77
ALL1
129.39
129.39
AMD1
29.73
29.73
ANG1
7,772.77
7,772.77
AOA1
53.35
53.35
ARS1
482.14
482.14
AUD1
10,375.77
10,375.77
AWG1
7,995.37
7,995.37
AZN1
8,425.09
8,425.09
BAM1
8,299.56
8,299.56
BBD1
7,171.86
7,171.86
BDT1
169.71
169.71
BGN1
8,319.73
8,319.73
BHD1
38,038.03
38,038.03
BIF1
8.10
8.10
BMD1
14,343.72
14,343.72
BND1
9,493.49
9,493.49
BOB1
2,075.83
2,075.83
BRL1
3,675.14
3,675.14
BSD1
14,343.72
14,343.72
BTC1
91,583,896
91,583,896
BTN1
205.12
205.12
BWP1
1,324.36
1,324.36
BYN1
6,969.22
6,969.22
BZD1
7,134.69
7,134.69
CAD1
10,909.89
10,909.89
CDF1
8.81
8.81
CHF1
14,437.67
14,437.67
CLF1
613,504.02
613,504.02
CLP1
21.48
21.48
CNH1
2,065.99
2,065.99
CNY1
2,068.08
2,068.08
COP1
4.76
4.76
CRC1
25.27
25.27
CUC1
14,343.72
14,343.72
CUP1
562.49
562.49
CVE1
147.19
147.19
CZK1
631.41
631.41
DJF1
80.56
80.56
DKK1
2,182.21
2,182.21
DOP1
287.50
287.50
DZD1
120.29
120.29
EGP1
801.50
801.50
ERN1
956.45
956.45
ETB1
519.14
519.14
EUR1
16,267.66
16,267.66
FJD1
6,765.74
6,765.74
FKP1
18,206.39
18,206.39
GBP1
18,206.39
18,206.39
GEL1
5,780.22
5,780.22
GGP1
18,206.39
18,206.39
GHS1
2,943.81
2,943.81
GIP1
18,206.39
18,206.39
GMD1
297.89
297.89
GNF1
1.58
1.58
GTQ1
1,913.77
1,913.77
GYD1
68.67
68.67
HKD1
1,827.29
1,827.29
HNL1
596.66
596.66
HRK1
2,190.41
2,190.41
HTG1
212.81
212.81
HUF1
50.12
50.12
IDR1
1.00
1.00
ILS1
3,892.81
3,892.81
IMP1
18,206.39
18,206.39
INR1
204.10
204.10
IQD1
12.03
12.03
IRR1
0.33
0.33
ISK1
131.24
131.24
JEP1
18,206.39
18,206.39
JMD1
105.56
105.56
JOD1
20,216.57
20,216.57
JPY1
129.72
129.72
KES1
142.30
142.30
KGS1
210.51
210.51
KHR1
3.52
3.52
KMF1
33.06
33.06
KPW1
15.93
15.93
KRW1
12.61
12.61
KWD1
47,280.81
47,280.81
KYD1
17,207.68
17,207.68
KZT1
39.64
39.64
LAK1
1.68
1.68
LBP1
9.49
9.49
LKR1
89.54
89.54
LRD1
93.32
93.32
LSL1
1,006.22
1,006.22
LYD1
10,276.86
10,276.86
MAD1
1,497.80
1,497.80
MDL1
864.13
864.13
MGA1
4.31
4.31
MKD1
264.18
264.18
MMK1
9.47
9.47
MNT1
5.87
5.87
MOP1
1,773.66
1,773.66
MRO1
40.12
40.12
MRU1
398.99
398.99
MUR1
412.17
412.17
MVR1
927.19
927.19
MWK1
19.72
19.72
MXN1
747.55
747.55
MYR1
3,495.48
3,495.48
MZN1
245.52
245.52
NAD1
1,005.51
1,005.51
NGN1
39.74
39.74
NIO1
447.89
447.89
NOK1
1,695.20
1,695.20
NPR1
128.20
128.20
NZD1
9,405.39
9,405.39
OMR1
37,254.49
37,254.49
PAB1
14,343.72
14,343.72
PEN1
4,323.00
4,323.00
PGK1
4,328.25
4,328.25
PHP1
267.88
267.88
PKR1
116.12
116.12
PLN1
3,764.23
3,764.23
PYG1
2.49
2.49
QAR1
3,939.43
3,939.43
RON1
3,487.43
3,487.43
RSD1
137.90
137.90
RUB1
213.05
213.05
RWF1
16.33
16.33
SAR1
3,823.97
3,823.97
SBD1
1,818.16
1,818.16
SCR1
1,055.33
1,055.33
SDG1
796.69
796.69
SEK1
1,557.02
1,557.02
SGD1
10,392.95
10,392.95
SHP1
18,206.39
18,206.39
SLL1
2.19
2.19
SOS1
24.79
24.79
SRD1
1,923.26
1,923.26
SSP1
110.11
110.11
STD1
0.68
0.68
STN1
660.54
660.54
SVC1
1,638.95
1,638.95
SYP1
27.85
27.85
SZL1
984.80
984.80
THB1
430.35
430.35
TJS1
1,522.29
1,522.29
TMT1
4,098.23
4,098.23
TND1
5,154.61
5,154.61
TOP1
6,207.95
6,207.95
TRY1
2,398.64
2,398.64
TTD1
2,127.88
2,127.88
TWD1
465.08
465.08
TZS1
6.28
6.28
UAH1
522.33
522.33
UGX1
3.83
3.83
USD1
14,343.72
14,343.72
UYU1
457.87
457.87
UZS1
1.84
1.84
VEF1
0.10
0.10
VND1
0.62
0.62
VUV1
132.20
132.20
WST1
5,541.25
5,541.25
XAF1
24.79
24.79
XAG1
211,784.47
211,784.47
XAU1
17,028,223.52
17,028,223.52
XCD1
5,307.47
5,307.47
XDR1
19,983.25
19,983.25
XOF1
24.79
24.79
XPD1
14,201,707.01
14,201,707.01
XPF1
136.32
136.32
XPT1
11,291,959.19
11,291,959.19
YER1
57.28
57.28
ZAR1
984.89
984.89
ZMW1
1,405.97
1,405.97
ZWL1
44.49
44.49
Taxation Exchange Rates
31 Aug 16 - 06 Sep 16
USD 1
13,232.00
AUD 1
10,043.30
CAD 1
10,213.70
DKK 1
1,999.40
HKD 1
1,706.22
MYR 1
3,283.28
NZD 1
9,623.63
NOK 1
1,605.23
GBP 1
17,433.70
SGD 1
9,757.68
SEK 1
1,569.45
CHF 1
13,631.10
JPY 100
13,101.00
MMK 1
11.01
INR 1
197.29
KWD 1
43,920.70
PKR 1
126.23
PHP 1
285.00
SAR 1
3,528.53
LKR 1
91.12
THB 1
382.08
BND 1
9,756.53
EUR 1
14,885.50
CNY 1
1,987.61

Okusi Associates: Indonesian Business & Management Services