City council approves tax collection decree

JAKARTA (JP): The city council yesterday approved a new provincial decree on development tax collection proposed by the administration.

The new decree abolished the collection system called the official assessment and will rely heavily on honest self assessment from restaurants, bars and other outlets which charge customers 10 per cent tax on food and drinks.

"The system is better than the old one because tax payers (the food and drink outlets) are being trusted to count, collect and pay the tax to the city revenue office. The system will also enable city officials to concentrate on serving and supervising the tax payers," Hizbiyah Rochim, spokesperson from the United Development Party faction, said in the plenary meeting.

However, the faction also warned the administration to be fair in serving tax payers and urged the revenue office to improve the skills of its officials in implementing the decree.

Meanwhile the Armed Forces faction urged the city administration to provide detailed information to tax payers before implementing the decree.

"This is important if the city administration wants the decree obeyed by the tax payers," Sutarno, the spokesman for the faction, said.

The decree will come into effect as soon as it gets approval from the minister of home affairs.

The head of the city revenue office, Wahab Rachmatsjah, said that the new system was made to simplify the collection procedure and to trust restaurants and other entertainment centers to pay the tax.

"The system was drawn up to cope with the current development situation as well as to improve our service to tax payers," Wahab said.

Wahab said the city administration has estimated the revenue from last year's development tax will increase by 17 percent, from Rp 196 billion (US$85.21 million) to Rp 230 billion in the 1996/1997 fiscal year.

He said the estimation is based on last year's revenue from the tax sector which was 28 percent higher than the target of Rp 153 billion.

"On the other hand the number of restaurants and other entertainment centers in Jakarta has also increased from 3,005 last year to 3,069 this year," he said

Wahab said all tax payers should register with his office and monthly payments will be compared with the previous payments.

"We will know if they are cheated because it is impossible for the payments to be much smaller than in previous periods," he said. (yns)