City to crack down on tax evasion among foreigners

Ahmad Junaidi, The Jakarta Post, Jakarta

Amid reports on foreign investors leaving the city, the city administration vowed on Friday to take stern measures against foreigners who violate regulations, including tax evasion.

"We will improve law enforcement against foreigners who evade taxes. Currently, law enforcement is very weak," Deputy Governor Fauzi Bowo told reporters on the sidelines of a seminar on population here. The tax include income tax and DPKK (tax payable to training fund at the ministry of manpower).

He said the administration would soon launch operations to identify foreigners, who worked in companies in Jakarta, in an effort to secure accurate data on the number of foreigners working here.

"The survey will be conducted on companies, apartments, hotels and restaurants. We will impose tougher sanctions," Fauzi said without giving details of the measures.

Several foreign investors in the city and surrounding areas have left the city, reportedly due to labor issues.

According to the Directorate General of Taxation, about 5,000 families paid income tax to the city, which amounted to Rp 50 billion this year.

"The central government received Rp 250 billion in taxes from the foreigners while Rp 50 billion of it was received in the city," the personal and company tax agency office head Hardjatmo told reporters.

"The amount of revenue from taxes could be increased as the number of foreigners in the city is much higher than that," he said.

According to the Jakarta Population Agency, the number of foreigners in Jakarta reached 28,000 but data at the Jakarta immigration office indicated that there were 32,000 foreigners in the city.