Economist calls for real-time verification system to prevent under-invoicing

Senior Researcher at CORE Indonesia, Mohammad Ishak Razak, has stated the need for a real-time price verification system based on international market data to prevent under-invoicing in export activities. He added that the system could be utilised by the Directorate General of Customs and Excise (Ditjen Bea Cukai) under the Ministry of Finance (Kemenkeu) and the Tax Directorate to detect price anomalies caused by such manipulation. ‘Another alternative to curb under-invoicing is the mandatory reporting of export transaction values through an integrated system involving banks, PPATK (Financial Transaction Reports and Analysis Centre), and the Directorate General of Customs and Excise, enabling data reconciliation without additional intermediaries,’ Razak said. He also noted the government could use escrow accounts to temporarily hold payments for high-value strategic commodity exports before releasing funds to exporters once the reported sales value is verified. Under-invoicing has long been a concern for the government regarding export and import activities. President Prabowo Subianto stated that under-invoicing in natural resource exports has potentially caused the state to lose around US$908 billion over 34 years. The government established PT Danantara Sumber Daya Indonesia (DSI), a state-owned enterprise (BUMN) dedicated to exporting strategic commodities, to combat such manipulation. However, Razak highlighted potential increases in logistics costs and more complex export and administrative processes under the one-stop export governance system. ‘If the system is not sophisticated enough, it could delay foreign currency inflows, contradicting the policy’s intended purpose,’ he said.