House welcomes next tax bills as revenue getters
House welcomes next tax bills as revenue getters
JAKARTA (JP): The House of Representatives (DPR) yesterday
welcomed the tax bills which will improve law enforcement among
taxpayers and streamline the tax collection system.
The four political factions of the House said in their general
views on the bills, in a plenary session that will amend the tax
laws introduced in 1984, that law enforcement is a key factor in
increasing the government's tax receipts.
The factions expressed concern that taxpayers' compliance with
the tax rule is still relatively low, partly caused by the moral
frailty among taxpayers and tax officials on the role of state
budget.
Each of the factions gave their own different figure on the
ratio of the number of taxpayers against the population, but all
of them concurred that the improvement of law enforcement will
help raise the number of taxpayers in the country.
"It is estimated that our country is home to only three
million taxpayers, as compared to its population of 185 million
people," a spokesman for the Armed Forces (ABRI), Soetrisno,
said.
"We welcome the spirit of the law enforcement in the tax bill
with a commitment of taking strict measures against taxpayers and
government officials who are involved in tax evasion and
malfeasance," he said.
The faction added that a better administration proposed by the
bills will also improve the efficiency of tax collection with the
self-assessment scheme.
Setyadji Lawi, spokesman for the Indonesian Democratic Party
(PDI), said that improvements in the quality of the work of tax
department officials is also important in supporting the success
of law enforcement. "We therefore suggest that the government
improve its supervision of the officials involved in tax
collection," he said.
The four factions also agreed that the streamlining of the
collection system will most likely increase the compliance of
taxpayers.
Administration
The Golkar faction suggested that the tax administration
should be simplified, considering that many taxpayers are
reluctant to spend much time dealing with administrative affairs.
Many businessmen hire consultants to deal with their tax
payments, said the spokesman of the Golkar faction, Jusuf Talib.
Director General of Tax Fuad Bawazier told reporters after the
plenary session that he has instructed tax officials throughout
the country to realign the system of tax collection to make tax
payments easier.
According to its budget plan for the 1994/1995 fiscal year,
the government expects to receive tax revenues of Rp 34.81
trillion, 58.2 percent of its planned total domestic revenues of
Rp 59.74 trillion.
Out of the tax revenues, Rp 18.84 trillion is expected from
income tax, Rp 13.24 trillion from value-added tax, Rp 1.63
trillion from land and building (property) tax and Rp 281.7
million from other taxes.
The four factions also expressed their concern that the new
tax bills do not propose more tax bases, which are supposed to
raise state revenues.
The United Development Party (PPP) faction, for example, said
that the bills do not mention the collection of taxes from
forestry, fishery or agricultural businesses.
The faction expected the government forestry, fishery and
agricultural products, which are subject to tax, to be in the
revenue estimates.
The PPP faction supported the government's proposal of giving
special tariffs to investors and entrepreneurs running businesses
in remote areas or in the eastern parts of the country.
"We are optimistic that special tariffs will attract more
investors to do business in less-developed provinces," Mukrom
As'ad of the PPP faction said.
"We suggest that the government give a tax break for those who
are ready to do business in eastern provinces," he added.
Tax Director General Fuad Bawazier told reporters that the
government is now preparing a new deregulation on tax rates for
companies investing in less-developed areas.
"I cannot give details now, but I assure you that the special
treatment is coming," he said. (fhp)