Draft taxation amendments business-friendly: Kadin<\/p>\n
Rendi A. Witular and Urip Hudiono, The Jakarta Post, Jakarta<\/p>\n
The recently completed draft revisions of the tax legislation
\nhave been hailed as business-friendly as they offer relatively
\nlow tax rates while encouraging better compliance among
\ntaxpayers.<\/p>\n
Indonesian Chamber of Commerce and Industry (Kadin) chairman
\nMohamad S. Hidayat told The Jakarta Post on Wednesday that the
\ndraft amendments offered incentives that would not only stimulate
\nthe economy but also help expand the tax base as a result of the
\nintroduction of a simpler taxation regime.<\/p>\n
"In general, we are satisfied with the draft amendments
\nalthough several of our submissions were turned down by the
\ngovernment. There was give and take during the drafting process
\nand we are comfortable with that," he said.<\/p>\n
Hidayat pointed to a number of incentives in the draft
\namendments that could help revive the real sector -- including a
\nplan to scrap the 10 percent value-added tax (VAT) on unprocessed
\nagricultural produce and a reduction in the income tax rate for
\nmicro and small businesses from the current maximum of 30 percent
\nto 10 percent.<\/p>\n
Another incentive that found favor with the business community
\nwas the proposed introduction of a tax amnesty in one of the
\namendments, which was aimed at improving taxpayer compliance,
\nespecially in the corporate sector, he added.<\/p>\n
The tax amnesty plan, which is one of the government's top
\npriorities, was initiated by Coordinating Minister for the
\nEconomy Aburizal Bakrie, himself a former Kadin chairman. The
\ninfluential business lobby group has been promoting the idea of
\noffering a tax amnesty for the past three years as part of its
\nproposals for comprehensive tax reform.<\/p>\n
The Ministry of Finance's Directorate General of Taxation
\nrecently completed reviews of the Tax System Law (No. 16\/2000),
\nthe Income Tax Law (No. 17\/2000) and the VAT and Luxury Tax Law
\n(No. 18\/2000).<\/p>\n
Hidayat said the government had accommodated the interests of
\nthe business community by inviting a team from Kadin to
\nparticipate in the drafting of the amendments, with the views of
\nthe team actually being listened to this time around.<\/p>\n
The members of the Kadin team included former finance minister
\nBambang Subianto, who held office during the administration of
\nformer President B.J. Habibie, and senior accountant John
\nPrasetyo.<\/p>\n
According to Hidayat, among the proposals by Kadin that were
\nstymied by the tax office was one for compensation should the tax
\ntribunal accepted a taxpayer's complaint.<\/p>\n
The directorate also thwarted Kadin's proposal for the
\ninstitution of equality before the law, which would mean that tax
\nofficials would be treated in the same way as taxpayers in
\ncriminal prosecutions involving tax issues.<\/p>\n
Meanwhile, Minister of Finance Jusuf Anwar said that although
\nthe proposed amendments would result in a temporary loss of tax
\nrevenue, the government was confident that this would eventually
\nbe compensated for by increased investment.<\/p>\n
"If you want to fish, you have to provide some bait. And what
\nis the bait (to attract investors)? It involves providing a
\nfavorable business environment, including business-friendly tax
\npolicies," he said.<\/p>\n
"The government is aiming to convert the taxation, and customs
\nand excise systems into facilitators for trade, industry and
\ninvestment," he added.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/draft-taxation-amendments-business-friendly-kadin-1447893297",
"image": ""
},
"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
}