Government plans tax offices in districts nationwide

Government plans tax offices in districts nationwide

JAKARTA (JP): The Directorate General of Taxes will
substantially increase the number of tax service offices in the
country to intensify the collection of taxes and to improve
services to taxpayers, Director General of Taxes Fuad Bawazier
says.

"The service improvement is very urgent considering that we
have thus far only 120 tax service offices responsible for
serving around 2.48 million taxpayers in the country," he told
reporters during his on-the-spot visits to three tax offices in
South and West Jakarta on Thursday, the last day for the
collection of income tax returns.

Fuad was accompanied by members of the Budgetary Commission
and Commission VII (for finance and trade) of the House of
Representatives (DPR) in the visits.

He said that the directorate general has instructed its
regional tax offices throughout the country to support and
control the management and operations of tax service offices in
their areas.

In addition, the directorate general will also establish a
special tax office in Jakarta to serve companies listed on the
capital market, he said.

"We have designed a fully computerized office for publicly
listed companies, which will hopefully ease collection of their
taxes," he said, adding that the establishment of the office is
expected to encourage listed companies to improve their
professionalism.

Fuad declined to elaborate investments for the service
expansion, but said that all the planned offices will be fully
operational by the end of the current fiscal year, which started
yesterday.

The directorate general has now operated a special tax service
office to deal with tax collection from foreign companies and
organizations and another one from state companies.

Fuad said his office also plans to facilitate all its regional
tax offices with computer equipment. "I believe all tax offices
in Jakarta will be computerized by next year, while the other
offices will be gradually equipped with computers within next
five years," he told The Jakarta Post.

The computer system is now operational for the tax office in
South Jakarta in what they said a pilot project for tax services
in the capital.

Imperative

"It is imperative to modernize our tax offices, considering
that over 50 percent of the government's domestic revenues come
from tax collection," Fuad said.

According to its budget plan for the 1994-95 fiscal year
beginning yesterday, the government expects to receive taxes of
around Rp 34.81 trillion (US$16.25 billion), almost 60 percent of
its estimated revenues of Rp 59.74 trillion domestic sources. Its
tax revenues in the fiscal year will include Rp 18.84 trillion
from income tax, Rp 13.24 trillion from value-added tax, Rp 1.63
trillion from land and building tax and Rp 281.7 million from
other taxes.

This fiscal year's tax revenues will feature a 23-percent
increase from Rp 28.2 trillion expected in the 1993-94 fiscal
year.

Fuad said Thursday he was optimistic that the government's
target to gain Rp 28.2 trillion from taxes in 1993-94 will be
achieved due to improvement in business activities in the
country.

Afif Ma'roef, a member of the Budgetary Commission joining
Fuad's trips, said the collection of taxes had reached Rp 28.08
trillion as of 10:00 A.M on Thursday. But Fuad declined to make
confirmation on the figure, saying that the official report on
the figure is under the responsibility of Minister of Finance
Mar'ie Muhammad.

Collusion

Meanwhile, Aberson Marle Sihaloho, a member of Commission VII,
said the government's target is actually too low, as compared to
the potentials of the taxpayers.

"Based on the World Bank's survey, Indonesia's tax payments of
13 percent of its gross domestic products (GDP) is lowest among
the six members of the Association of Southeast Asian Nations
(ASEAN)," he said, adding that Thailand leads the group with 17.7
percent, followed by Singapore with 16.7 percent, Malaysia with
15.2 percent and the Philippines 14 percent.

He told the Post that one of the possible factors which
hampered the growth in the tax payments is the collusion between
taxpayers and tax officials.

He said such a fact has unavoidably encouraged taxpayers to
manipulate their tax returns, which are filled in on the basis of
self assessment. (fhp)