Wed, 07 Apr 2010


By Ahmad Pathoni
Jakarta - A scandal involving an Indonesian tax official accused of amassing millions of dollars in his bank accounts has put a spotlight on corruption in the country's bureaucracy.

Indonesia embarked on sweeping reforms after the fall in 1998 of autocratic president Suharto, whose 32-year rule was marked by widespread corruption, but critics said the country's bureaucracy remains blighted with graft.

Indonesian police last week arrested Gayus Tambunan, 30, a mid-level official at the Finance Ministry's Directorate General of Taxation, after it was revealed that he amassed 28 billion rupiah (3.1 million dollars) allegedly collected from businesspeople seeking favourable verdicts in tax disputes.

He was picked up by Indonesian police in Singapore after fleeing the country.

Anti-corruption activists said the case was the tip of an iceberg.

"The Gayus case is just a tiny sample of corruption in the Finance Ministry," said Firdaus Ilyas, head of monitoring at Indonesia Corruption Watch, an anti-graft watchdog. "There are many others involving a lot more money."

"It should serve as an entry point to uncover other corruption cases," he added.

The case has made headlines in Indonesia for weeks, and television repeatedly showed Tambunan's abandoned, dilapidated family house, contrasted with his luxury residence in an upmarket Jakarta area.

The scandal has sparked anger among Indonesians and prompted calls for the public to stop paying taxes. More than 32,000 people have joined a group on the popular social-networking website Facebook, calling for a tax boycott.

"I'm reluctant to pay taxes," a Facebook group member, Abdul Karim, wrote on the site. "I'd rather give my money to the poor than have it stolen by people whose stomaches are already swollen."

President Susilo Bambang Yudhoyono, who won re-election last year on pledges to root out corruption, has called for a thorough clean-up of the bureaucracy, saying corruption was an obstacle to development.

"Corruption in the justice system and other sectors, including tax crimes, must be investigated thoroughly," Yudhoyono told reporters Wednesday. "Tax crimes do not only involve taxpayers and tax officers but also members of law enforcement agencies such as police, prosecutors, judges and lawyers."

Several police officers have also been fired and prosecutors being questioned for allegedly accepting bribes while investigating Tambunan on suspicion of money laundering.

Finance Minister Sri Mulyani Indrawati, who has been praised for her bold drive to clean up the bureaucracy, said Tambunan had been dishonourably dismissed from the tax office.

She also said she would take a number of measures to minimize corruption in the future, including reviewing the tax payment system and forming a team to investigate conflicts of interests.

Ten of Tambunan's superiors at the tax office have also been suspended from their positions pending an investigation.

Former economics minister Rizal Ramli said the Finance Ministry's move to raise its civil servants' salaries had not proven to deter corruption.

"Bureaucratic reform at the Finance Ministry remains a paper tiger," he said. "They raised remunerations but have failed to improve the civil servants' performance."

Local media reported Wednesday, citing unnamed police sources, that Tambunan had actually had 200 billion rupiah in his bank account at one time but the money had been transferred to a foreign bank account.

The case against Tambunan began last year when the Financial Transactions Report and Analysis Centre, a government money-laundering watchdog, discovered an unusual amount of money in his bank accounts.

Tambunan was charged with embezzlement and money laundering, but he was acquitted by a court.

Then-national police detective chief, Susno Duadji, later told the media that investigators had received bribes from Tambunan. Duadji has been questioned in an internal police investigation.

Transparency International, a global graft watchdog, regularly ranks Indonesia as one of the world's most corruption-prone countries. The country's law enforcement agencies are seen as among the most corrupt institutions.