Four executives go to prison for tax fraud

Four executives go to prison for tax fraud

JAKARTA (JP): Four executives of private companies were given
nine years in prison for tax evasions which caused the state
losses of more than Rp 44 billion (US$18.76 million).

The four, tried separately in Central Jakarta District Court
yesterday, were found guilty of establishing companies to issue
fictitious value-added tax invoices, the panel of judges said.
The judges also said that the defendants sold the fictitious
value-added tax invoices for between six and 30 percent of their
face value, between March 1993 and June 1995.

Defendants Hartono, 46, and Raden Ign. Suarisman, 57, were
tried by a team of judges led by I.G.K. Sukarata, while
defendants Baharuddin Umar, 46 and Tonny Effendy, 31, were tried
by a panel of judges presided over by Sartono.

"The defendants Hartono and Suarisman must pay back Rp 150
million and Rp 25 million respectively in addition to the Rp 15
million fine," Judge Sukarata said.

Tonny and Baharuddin were also told by Judge Sartono to pay Rp
200 million and Rp 80 million respectively in compensation to the
state.

Tonny said he wanted to appeal, while the three other
defendants said they were still considering their options.

Prosecutor M. Djaenuddin Nare had asked the court to sentence
Hartono and Suarisman to 14 years each. Prosecutor R. Moekiat,
who indicted Baharuddin and Tonny, asked the court to sentence
the defendants for 14 years as well.

The prosecutors charged the defendants with a 1997 law on
corruption.

Some businessmen use fictitious tax invoices to produce tax
rebates for their companies by claiming to have carried out
export transactions with other firms.

Businessmen are obliged to collect 10 percent in value-added
tax when consumers make purchases, and pay this to the state.

The exporters are entitled to claim back any tax paid to the
state when the goods are exported. The defendants' companies are
legal and are allowed to issue tax invoices. But the invoices
were fake because no real transactions were made, the judges
said.

September last year the Central Jakarta District Court
sentenced a businessman to nine years in jail and fined him Rp 30
million for defrauding the state of Rp 15 billion in taxes. (sur)