600,000 Jakartans not paying tax

JAKARTA (JP): Director General of Taxation Hadi Purnomo estimates that almost two-thirds of Jakarta's potential taxpayers do not pay income tax.

Hadi said on Tuesday that based on 1999 data, Jakarta should have 900,000 taxpayers, but as of May this year, only 300,000 people were registered at the local tax office.

"We expect to increase the number of taxpayers registered in Jakarta from 300,000 to 700,000 people by the end of our awareness program," Hadi said after signing an agreement on the "income tax awareness program" with Governor Sutiyoso at City Hall.

The city administration expects to receive Rp 1.4 trillion (US$12.7 million) in income tax payments collected by the central government this year.

City spokesman Muhayat said the income tax collected by the central government had thus far never been shared with local administrations.

"Starting this year, due to regional autonomy, some of the income tax revenue will be given to regional administrations," Muhayat announced after the signing ceremony.

He said Rp 1.4 trillion was a conservative projection under which the number of taxpayers in the capital was estimated at 200,000.

On top of the Rp 1.4 trillion, the city administration will also get Rp 773 billion from the central government to pay about 50,000 employees transferred from the central government to the city administration following the decentralization of various ministries and also the closure of a number of ministries.

The city administration has received Rp 500 billion of the allocated Rp 773 billion.

The city administration needs Rp 1.3 trillion to pay the annual salaries of its 130,000 employees.

Muhayat said the additional income of Rp 1.4 trillion would be used to pay the salary increases of employees.

"The increases have yet to be paid from January until now. They will be paid in July," Muhayat said. (jun/04)