Freeport largest taxpayer

Recent media reports in the capital have it that Mr. Amien Rais has said more or less the following about PT Freeport Indonesia:

Whereas after Mr. Amien Rais criticized the performance of PT Freeport Indonesia, it is now ranked first as a taxpaying company in Indonesia, a big jump from its previous rank of 54th.

As Mr. Amien Rais is now gaining greater fame and reputation, a proper response to or explanation about the above statement is needed from authorities, or the statement could cause misunderstanding among community members in Indonesia.

This misunderstanding may be of two kinds, both being incorrect for lack of supporting evidence.

The first kind of misunderstanding is the opinion that Mr. Amien Rais has such outstanding ability that with his sharp criticism he can boost the performance of PT Freeport so that within a relatively short period of time the company can amazingly change itself so that as a taxpaying company it can jump from 54th to first.

The second kind of misunderstanding, which is rather negative in nature and may harm the reputation of the company, is the opinion that PT Freeport has during this time engaged in unfair practices.

For many years before Mr. Amien Rais launched his criticism, the company paid just enough taxes to be 54th while it could have afforded to pay a larger amount for first position. In other words, the company has during this time been engaged in large- scale tax evasion.

Reality is in fact different.

When Mr. Mar'ie Muhammad, the minister of finance, was director general of tax, taxpaying companies were grouped on the basis of the amount of the taxes paid. At that time PT Freeport was ranked 54th, although it paid over Rp 100 billion in taxes. More accurate data must be available at the Ministry of Finance.

If a taxpaying company ranked 54th has paid so many taxes, logically other taxpayers at a higher ranking should have paid a larger amount of taxes. If there had been 100 potential big taxpayers in Indonesia at that time, the state's tax revenue would have played a dominant role in financing the state budget.

The then president director of PT Freeport, Mr. Usman Pamuncak, immediately contacted the Directorate General of Tax to inquire about this matter. A reexamination was then conducted. The result was that there was a technical error. After the error was corrected, PT Freeport Indonesia was then declared Indonesia's largest taxpayer.

SUKANTO

Jakarta