Banks forge reports, evade taxes

Banks forge reports, evade taxes

JAKARTA (JP): A number of private banks manipulate their
financial reports to evade tax payments, Tax Director General
Fuad Bawazier disclosed yesterday.

Fuad refused to name which banks were engaged in such
practices but said that one of them was caught "red-handed" only
recently.

The alleged financial manipulation was unveiled at a hearing
with the Finance and Trade Commission of the House of
Representatives.

A number of private banks have, at least, two different
financial reports which they use for different purposes, he
charged, adding that a financial statement showing poor
performance is usually submitted to the taxation office to seek
lower tax payments and another one, indicating high achievement,
is submitted to Bank Indonesia, the central bank, to seek higher
credit points.

"Unfortunately, a bank recently filed with our office the one
meant for Bank Indonesia," he told the House members of his
finding.

"When we charged a high tax, the bank asked for a tax
reduction. It later admitted that it filed the wrong financial
statement." he said of the bank's technique in manipulating tax
payments.

He said that the bank, instead of receiving a tax reduction,
was fined for its practice. In addition, it was also reported to
the central bank for the wrong doing.

Fuad said that his office also found a number of other banks
manipulating their financial statements after assessing their
real financial reports.

The tax office is allowed to verify a bank's financial
accounts despite the banking secrecy law.(hen)