ICW reveals alleged tax embezzlement<\/p>\n
JAKARTA (JP): The Indonesian Corruption Watch (ICW) revealed
\non Thursday an alleged multimillion dollar tax embezzlement
\noperation disguised under a bank's deposit scheme that has
\noccurred in the past five years.<\/p>\n
The private commercial bank, identified as PT PIB, invites
\ncustomers to invest their money in a U.S. dollar deposit scheme
\nwhere its interest will not be taxed.<\/p>\n
According to ICW, the bank claimed that it marketed such a
\nscheme to Indonesian customers for its sister company PBII in the
\nRepublic of Nauru.<\/p>\n
\"But the two banks, although belonging to the same group, are
\nnot structurally attached. PIB claimed that the fixed deposits
\nwent to PBII, but actually the money was kept by the bank
\nitself,\" Irfan Muktiono of ICW told a media conference.<\/p>\n
\"This is an illegal way to amass funds as it violates banking
\nand tax regulations,\" he said.<\/p>\n
He further disclosed that, according to the bank's January and
\nFebruary 2000 data, there were 98 fixed deposits attached to the
\nscheme totaling US$10.6 million in one of its Jakarta chapters.<\/p>\n
PIB itself has 102 chapters in the country.<\/p>\n
ICW calculated that in two months only, the publicly listed
\nbank should submit some $9.6 million to the state from its
\ndeposits interest as stipulated in Law No. 10\/1994 on income tax
\nand letters of instruction from Bank Indonesia.<\/p>\n
The law authorized the government to impose an average of 10
\npercent tax on the interest of deposits.<\/p>\n
Irfan suspected that there was corruption practices in the
\nscheme, which had lured 170 big-name customers. He called upon
\nthe government to check how they could have obtained such a large
\namount of money deposited in the bank.<\/p>\n
The corruption watchdog also assumed that such a practice was
\nrather like money laundering, which was also often found in
\nsimilar schemes both in state and private banks.<\/p>\n
ICW chairman Teten Masduki said the result of the
\ninvestigation was submitted to the directorate-general of tax
\nearly this month but he admitted there were difficulties in
\ninvestigating the case due to regulations on bank secrecy.<\/p>\n
Teten explained that Presidential Decree No. 68\/1983 forbids
\nthe tax office to probe the identity of depositors in local banks
\nfor taxation purposes. He sensed a conspiracy in the embezzlement
\nof the deposits' taxes which involved the tax office and the
\ncentral bank.<\/p>\n
\"It probably would implicate the bank accounting company,
\nwhose initials are HTM,\" Teten said.<\/p>\n
\"It's time for the directorate-general to check on whether the
\nbig tax payers have paid their obligations, and not only go after
\nthe small fish, to reach its goal to collect Rp 179 trillion in
\ntaxes to support the state's 2001 budget,\" he added.<\/p>\n
On a separate occasion, director general of tax Hadi Purnomo
\ntold Antara that his office had established a special four-member
\nteam to further investigate the report from ICW.<\/p>\n
However, he said, they had to ask for Bank Indonesia's
\napproval to summons the suspected banks.(bby)<\/p>",
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