A compulsory contribution

There will no longer be any doubts as to the obligation of big taxpayers to set aside 2 percent of their incomes to help poor families. This contribution, which major taxpayers have so far been asked to make on a purely voluntary basis, has now been made compulsory.

The government is now requiring corporate and individual taxpayers with annual net incomes of Rp 100 million or more to donate 2 percent of their after-tax profits for the above- mentioned purpose.

From the point of view of intent (helping the poor), this shift from a voluntary to a compulsory basis deserves to be supported. What is regrettable is that the formal obligation to pay such as compulsory levy is based on a mere government regulation. We believe it should be contained properly in a law, because non-payment of the contribution is now punishable. For businessmen, the upsetting thing may be that the new regulation is valid as of fiscal year 1996.

The amount of money that will be collected through this new regulation is estimated to be quite considerable. Some believe it to be no less than Rp 250 billion a year. If this is true, the regulation will certainly be most meaningful to the efforts to eliminate poverty.

We very much hope that proper transparence will be observed in the management of the fund, in the reporting system that is applied and in the allocation of responsibilities.

-- Bisnis Indonesia, Jakarta