Finance ministry unveils $28m in corruption

JAKARTA (JP): The finance ministry announced on Monday it had uncovered 11,536 corruption cases involving Rp 183.64 billion (US$28 million) occurring from April 1997 to the end of last month.

Finance minister Bambang Subianto said that more than 76 percent of the corruption was linked to tax fraud.

"These findings are related to wrongdoings by various parties," Bambang told a news conference.

Bambang, however, declined to disclose the names of those who had either failed to pay taxes or were involved in tax fraud.

"I can't remember all their names. But they can be given to you on the next occasion," he said.

Bambang said the government had conducted further investigations into 6,166 corruption cases covering Rp 27.56 billion.

Bambang's announcement was part of the government's third- stage report on the results of the national campaign against corruption, collusion and nepotism, particularly during the 32 years of former president Soeharto's rule.

Rampant corruption and collusive practices have been cited as main causes of the country's deep economic trouble.

The Habibie administration has intensified efforts to root out corruption amid pressure from the public. But he has yet to take serious measures against the alleged corruption committed by his predecessor Soeharto, who according to a recent Time magazine report had allegedly amassed some $15 billion in wealth.

Bambang said the government had revised various past regulations which provided tax relief and other privileges to certain institutions and companies.

He pointed out that certain foundations, particularly those linked to Soeharto, were no longer exempt from paying time deposit tax.

He added that the government would no longer provide import duty exemptions to cars brought in by taxi operators or on capital goods procured by independent power producers.

Bambang added that the government had revoked rulings which provided special tax treatment for controversial carmaker PT Timor Putra Nasional.

Timor, which is owned by Soeharto's youngest son, owes some Rp 3.2 trillion in back taxes to the government.

Under a previous ruling, Timor was exempt from paying tax and duties on car imports from South Korea under the condition that 20 percent of their components were locally made.

But since the company failed to meet the requirement, the government ordered Timor to pay the taxes and import duties.

The case is being reviewed by the State Administrative Court.

Bambang also announced on Monday new criteria on companies required to submit annual financial reports to the government in a bid to improve transparency and increase government tax revenue.

He said that under government regulation No. 64/1999, companies which must submit annual financial reports include those with minimum assets of Rp 25 billion or those which have bad debts at local banks.

Bambang said foreign companies operating in Indonesia were also obliged to submit annual financial reports.

Bambang said the new criteria were effective as of this financial year, except for the requirement of Rp 25 billion in minimum assets which would become effective next year.

He added that the financial information on the companies would be provided for the public through the ministry's website (http://lktp.dprin.go.id).

The government stipulated last year that companies with minimum assets of Rp 50 billion were required to submit annual financial reports. Publicly listed companies or financial institutions which raised public funds or issued debts are also subject to compulsory reporting.

Bambang said the new regulation does not annul earlier rulings.

He said the government expected information on some 1,000 companies would be included in the website by the end of this month.

He added that the figure was projected to increase to 3,000 to 4,000 by the end of this year.

Bambang said the compulsory reporting would help the government build a strong database in designing various policies including tax and investment.(rei)