Businessmen charged with tax abuse

Businessmen charged with tax abuse

JAKARTA (JP): Four company executives are being charged with violating their right to issue value-added tax invoices by falsifying the transactions of goods and services, the Central Jakarta District Court was told Tuesday.

"Legally, their companies are registered at the justice ministry. But these executives are believed to have submitted tax invoices for transactions that never took place," Jon Hardi, a tax investigator, told the Central Jakarta District Court.

The four businessmen -- Baharuddin Umar, Tony Effendy, Hartono and Raden Ignatius Suarisman -- are being tried for falsifying and selling value-added tax invoices, which cost the government Rp 58.3 billion in lost tax revenues from 1993 to 1995. The four are being tried separately in two court hearings .

The four businessmen are also being charged with masterminding the establishment of 11 firms which conspired to falsify and sell value-added tax invoices. The scam later involved another 20 companies as the demand for the invoices increased.

Four of the witnesses were pressed by a team of judges and lawyers, but were unable to explain how the money was used or who benefited from the tax scam.

Bambang Suprihatin, a tax official brought in to testify on behalf of Suarisman, told the court that he was not aware of any regulation that monitors the payment of taxes.

The same four witnesses said that the suspects had told them that they had only printed and sold blank VAT invoices.

"There's no way for us to find out how many invoices were left blank or how many were filled out," Jon said.

"Suspect Hartono told me that he received a fee from suspect Tony Effendi to sign the invoices," Jon added.

On the other hand, suspect Suarisman objected to Bambang's testimony that Suarisman received fees for signing the false invoices.

"My signatures were forged," he told the court.

Company owners with tax numbers are allowed to print tax invoices. The invoices, however, are only legal when the company records actual transaction, several tax official witnesses told the court yesterday.

The tax officials, who investigated the companies set up by the suspects, said that the addresses of the companies were the same as the residents of the suspects.

The falsified invoices were sold at 30 percent of face value. The four suspects allegedly sold 12,500 counterfeited VAT invoices in three years. (14)