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
23 Sep 18
Buy
Sell
AED1
3,920.15
3,920.15
AFN1
189.90
189.90
ALL1
133.87
133.87
AMD1
29.86
29.86
ANG1
7,809.11
7,809.11
AOA1
49.79
49.79
ARS1
387.30
387.30
AUD1
10,505.46
10,505.46
AWG1
7,997.07
7,997.07
AZN1
8,457.43
8,457.43
BAM1
8,664.82
8,664.82
BBD1
7,199.39
7,199.39
BDT1
171.92
171.92
BGN1
8,659.38
8,659.38
BHD1
38,254.15
38,254.15
BIF1
8.13
8.13
BMD1
14,398.78
14,398.78
BND1
9,530.21
9,530.21
BOB1
2,085.12
2,085.12
BRL1
3,554.55
3,554.55
BSD1
14,398.78
14,398.78
BTC1
96,683,693
96,683,693
BTN1
199.93
199.93
BWP1
1,354.30
1,354.30
BYN1
6,920.36
6,920.36
BZD1
7,168.35
7,168.35
CAD1
11,143.21
11,143.21
CDF1
8.77
8.77
CHF1
15,016.72
15,016.72
CLF1
615,859.24
615,859.24
CLP1
21.59
21.59
CNH1
2,102.22
2,102.22
CNY1
2,099.65
2,099.65
COP1
4.79
4.79
CRC1
24.89
24.89
CUC1
14,398.78
14,398.78
CUP1
564.65
564.65
CVE1
152.83
152.83
CZK1
660.85
660.85
DJF1
80.88
80.88
DKK1
2,268.22
2,268.22
DOP1
287.73
287.73
DZD1
122.46
122.46
EGP1
804.94
804.94
ERN1
960.09
960.09
ETB1
519.85
519.85
EUR1
16,929.79
16,929.79
FJD1
6,836.36
6,836.36
FKP1
18,823.54
18,823.54
GBP1
18,823.54
18,823.54
GEL1
5,884.28
5,884.28
GGP1
18,823.54
18,823.54
GHS1
3,035.72
3,035.72
GIP1
18,823.54
18,823.54
GMD1
295.05
295.05
GNF1
1.59
1.59
GTQ1
1,866.92
1,866.92
GYD1
68.94
68.94
HKD1
1,843.78
1,843.78
HNL1
599.54
599.54
HRK1
2,277.74
2,277.74
HTG1
207.25
207.25
HUF1
52.16
52.16
IDR1
1.00
1.00
ILS1
4,032.86
4,032.86
IMP1
18,823.54
18,823.54
INR1
199.32
199.32
IQD1
12.07
12.07
IRR1
0.33
0.33
ISK1
130.74
130.74
JEP1
18,823.54
18,823.54
JMD1
106.13
106.13
JOD1
20,265.51
20,265.51
JPY1
127.91
127.91
KES1
142.64
142.64
KGS1
211.31
211.31
KHR1
3.51
3.51
KMF1
34.39
34.39
KPW1
15.99
15.99
KRW1
12.91
12.91
KWD1
47,613.46
47,613.46
KYD1
17,288.80
17,288.80
KZT1
40.45
40.45
LAK1
1.69
1.69
LBP1
9.52
9.52
LKR1
85.36
85.36
LRD1
92.92
92.92
LSL1
1,001.69
1,001.69
LYD1
10,455.82
10,455.82
MAD1
1,540.60
1,540.60
MDL1
857.88
857.88
MGA1
4.22
4.22
MKD1
274.83
274.83
MMK1
8.85
8.85
MNT1
5.89
5.89
MOP1
1,790.86
1,790.86
MRO1
40.27
40.27
MRU1
402.20
402.20
MUR1
421.63
421.63
MVR1
934.37
934.37
MWK1
19.79
19.79
MXN1
764.71
764.71
MYR1
3,483.56
3,483.56
MZN1
236.82
236.82
NAD1
1,001.69
1,001.69
NGN1
39.72
39.72
NIO1
450.11
450.11
NOK1
1,766.51
1,766.51
NPR1
124.95
124.95
NZD1
9,625.58
9,625.58
OMR1
37,457.34
37,457.34
PAB1
14,398.78
14,398.78
PEN1
4,376.72
4,376.72
PGK1
4,334.17
4,334.17
PHP1
265.45
265.45
PKR1
116.92
116.92
PLN1
3,928.46
3,928.46
PYG1
2.46
2.46
QAR1
3,954.62
3,954.62
RON1
3,634.68
3,634.68
RSD1
143.35
143.35
RUB1
215.37
215.37
RWF1
16.34
16.34
SAR1
3,839.42
3,839.42
SBD1
1,825.14
1,825.14
SCR1
1,059.62
1,059.62
SDG1
797.52
797.52
SEK1
1,638.14
1,638.14
SGD1
10,557.07
10,557.07
SHP1
18,823.54
18,823.54
SLL1
1.71
1.71
SOS1
24.90
24.90
SRD1
1,930.65
1,930.65
SSP1
110.53
110.53
STD1
0.68
0.68
STN1
686.31
686.31
SVC1
1,646.59
1,646.59
SYP1
27.95
27.95
SZL1
1,001.69
1,001.69
THB1
444.81
444.81
TJS1
1,528.80
1,528.80
TMT1
4,113.95
4,113.95
TND1
5,193.21
5,193.21
TOP1
6,231.79
6,231.79
TRY1
2,287.87
2,287.87
TTD1
2,137.72
2,137.72
TWD1
469.91
469.91
TZS1
6.30
6.30
UAH1
513.65
513.65
UGX1
3.76
3.76
USD1
14,398.78
14,398.78
UYU1
437.62
437.62
UZS1
1.79
1.79
VEF1
0.05
0.05
VND1
0.62
0.62
VUV1
132.70
132.70
WST1
5,562.52
5,562.52
XAF1
25.80
25.80
XAG1
205,880.98
205,880.98
XAU1
17,271,154.84
17,271,154.84
XCD1
5,327.85
5,327.85
XDR1
20,217.70
20,217.70
XOF1
25.80
25.80
XPD1
15,142,593.26
15,142,593.26
XPF1
141.87
141.87
XPT1
11,914,891.62
11,914,891.62
YER1
57.51
57.51
ZAR1
1,005.74
1,005.74
ZMW1
1,238.04
1,238.04
ZWL1
44.66
44.66
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