Govt revives idea for tax amnesty<\/p>\n
Rendi A. Witular, The Jakarta Post, Jakarta<\/p>\n
While the pace of reform of the tax system to prevent corruption
\nis not yet in full swing, the government has revived a
\ncontroversial idea for providing a tax amnesty for certain tax
\nevaders.<\/p>\n
There are fears that granting such an amnesty may violate the
\npublic's sense of fairness and justice, while it would also be
\ndifficult for the tax office to properly determine which
\ntaxpayers are indeed eligible for such an amnesty.<\/p>\n
\"We are currently preparing a draft bill for a tax amnesty to
\nbe forwarded soon to the House of Representatives for
\ndeliberation. We hope to gain approval from lawmakers for the
\nplan,\" Vice President Jusuf Kalla told The Jakarta Post on
\nWednesday.<\/p>\n
Kalla did not disclose the objective of the amnesty, but
\naccording to a source at the Ministry of Finance it is part of
\nefforts to expand the taxpayer base by encouraging taxpayers --
\nwho may have evaded taxes for many years -- to pay their taxes in
\nfuture.<\/p>\n
Many believe that the amnesty is also aimed at luring back
\nbillions of dollars parked overseas by Indonesia's conglomerates
\nin the aftermath of 1997-1998 financial crisis, in order to avoid
\ntax payments.<\/p>\n
The source said the amnesty would cover both individual and
\ncorporate taxpayers, and they would be able to settle unpaid
\ntaxes paying between 10 percent and 20 percent of the total.<\/p>\n
For corporate taxpayers, the proposed amnesty would cover
\nunpaid taxes between 1995 to 2003. For individual taxpayers, the
\ngovernment is still undecided.<\/p>\n
\"I think the current situation is not appropriate for granting
\nsuch an amnesty because of the country's corrupt and inefficient
\ntax administration. It will only benefit bad businessmen,\" said
\nthe source.<\/p>\n
The tax amnesty plan is one of the administration's top
\npriorities, initiated by Coordinating Minister for the Economy
\nAburizal Bakrie, who is a former chairman of the Indonesian
\nChamber of Commerce and Industry (Kadin).<\/p>\n
Kadin, the country's most powerful business lobby group, has
\nbeen promoting the idea of a tax amnesty for the past two years
\nas part of its comprehensive tax reform proposal that it
\nsubmitted to the government.<\/p>\n
The previous administration rejected the proposal over
\nconcerns that recalcitrant taxpayers and corrupt officials would
\nabuse the facility, exacerbated by a lack of transparency and
\nweak law enforcement.<\/p>\n
Another concern is that it may discourage honest taxpayers in
\ncontinuing to pay their taxes, in the hope that they too would be
\ngranted such a facility sometime in the future.<\/p>\n
Director General of Taxation Hadi Purnomo is known to be among
\nthose who reject the plan, arguing that the current lack of
\ntransparency in the tax system may lead to abuse of such a
\nfacility.<\/p>\n
The Tax Office is the nation's most important source of
\nrevenue, with the government seeking to ensure fiscal
\nsustainability and reduce its dependency on foreign loans.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/govt-revives-idea-for-tax-amnesty-1447893297",
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"sponsor": "Okusi Associates",
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