Tax office seeks independence from govt red tape<\/p>\n
Rendi A. Witular, The Jakarta Post, Jakarta<\/p>\n
Top officials at the Directorate General of Taxation are
\nmulling a controversial plan of turning the tax office into an
\nindependent agency in a bid to become more focused on netting
\ntaxpayers and enforcing tax laws.<\/p>\n
A source at the tax directorate told The Jakarta Post that the
\nofficials had recently been lobbying President Megawati
\nSoekarnoputri to sever its ties with the Ministry of Finance
\n(MoF).<\/p>\n
The source said the plan was driven by the fact that the
\ndirectorate could not fully focus on its job to collect taxes and
\nto enforce tax laws, because it had to deal also with other jobs
\nwhich should be carried out by other agencies, such as making
\npolicies and drafting tax laws.<\/p>\n
\"The directorate's tasks are currently confusing. We collect
\ntaxes, enforce the tax laws and at the same time have to make tax
\npolicies,\" said the source.<\/p>\n
Another reason was that the directorate had difficulty in
\ndirectly coordinating with other ministries and government
\nagencies because of its inferior position as a unit under the
\nMinistry of Finance.<\/p>\n
\"The directorate has to go through a lot of extra red tape at
\nthe Ministry of Finance before reaching those agencies,\" said the
\nsource.<\/p>\n
According to the source, the directorate was currently
\ndiscussing whether to adopt a similar system used by the U.S.
\nInternal Revenue Service (IRS), which is considered an ideal tax
\nadministration agency.<\/p>\n
The IRS, a branch of the U.S. Department of the Treasury, is
\ntasked only with the collection of taxes and the enforcement of
\ntax laws. The agency does not deal with policy making, as it is
\nhandled by other government entities including the Department of
\nthe Treasury.<\/p>\n
But the IRS commissioner and chief counsel are selected by the
\npresident and confirmed by the senate, meaning that they are
\ndirectly responsible to the president and not to officials at the
\nDepartment of the Treasury.<\/p>\n
The tax directorate's plan is timely because currently the
\ngovernment is in the process of reorganizing the structure of the
\nMinistry of Finance. The draft blueprint of the reorganization
\ndrive has been submitted to State Secretary to be discussed with
\nthe related ministers, before being approved by the President in
\nthe form of a presidential decree.<\/p>\n
The finance ministry's legal division head Maurin Sitorus said
\nthe blueprint contained no plan to form an independent tax
\ndirectorate.<\/p>\n
\"There is no such plan from the ministry. I have heard of the
\nrumors that the directorate is planning to separate itself, but I
\nhave no written evidence about it,\" said Maurin who is also the
\nspokesman of the ministry.<\/p>\n
Meanwhile, Director General of Taxation Hadi Purnomo claimed
\nthat he was unaware of the plan.<\/p>\n
\"I don't know about the plan. I am only doing my job which is
\nadministered by the tax laws... I don't know who proposed it,\"
\nsaid Hadi after attending a seminar on tax reform on Thursday.<\/p>\n
But according to a source at the Ministry of Finance, Boediono
\nwas enraged to find out that he was bypassed by the tax officials
\nwhen the plan was handed to the President, and so sent a warning
\nletter to Hadi.<\/p>\n
Elsewhere, tax and customs analyst Muhammad Ikhsan said that
\nideally the tax directorate should be independent from the
\nMinistry of Finance, but under close supervision of an
\nindependent agency.<\/p>\n
\"I agree with the separation plan, because currently the
\ndirectorate's tasks are mixed up. Tax regulations should now be
\nhandled by the State Fiscal Agency instead of by the tax
\ndirectorate,\" said Ikhsan.<\/p>\n
Ikhsan said he had proposed such a plan to the government in
\n1999.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/tax-office-seeks-independence-from-govt-red-tape-1447893297",
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"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
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