City seeks review on tax rulings

JAKARTA (JP): The government should review three regulations pertaining to collection of taxes and levies because they are burdensome to the regional administration, Deputy Governor for Economic and Development Affairs Budiardjo Soekmadi said on Wednesday.

Speaking at a City Council plenary session on behalf of Governor Sutiyoso, Budiardjo said the government should review Law No. 18/1997 on the collection of taxes and regional levies, Government Regulation No. 64/1998 on regional taxes and Presidential Decree No. 6/1993 requiring payment of 20 percent of revenues from hotel and restaurant taxes to the government.

Budiardjo charged that the regulations were unaccomodative toward the administration's need for more capital to finance routine and development expenditures amid sharp cutbacks in the 1998/1999 City Budget due to the crisis.

The budget was slashed from Rp 2.79 trillion to Rp 1.75 trillion in the first six month of its realization.

"We hope that the government will take our difficulties into consideration."

He said that Law No. 18/1997 had reduced the city's ability to collect various taxes and levies, including parking fees and expatriate taxes.

Under the law passed by the House of Representatives in April last year, the central government cut local taxes from 42 categories to nine and the number of levies from 192 categories to 30.

Budiardjo claimed all local administrations had opposed the obligation to submit 20 percent of regional revenues from hotel and restaurant taxes, "but there has yet to be a positive response from the government". (ind)