Interest income verification

Interest income verification

JAKARTA (JP): Tax Director General Fuad Bawazier promised
yesterday that tax officials will not be allowed to track funds
kept in time deposits and other forms of bank savings.

Tax officials are also not allowed to verify the accuracy of
taxpayer data and the incomes gained from interest on time
deposits and other bank savings, the tax director general said.

"It is in line with presidential decree No. 68 issued in 1983.
The decree frees time deposits and other bank savings from being
tracked and verified by tax officials," Fuad said in a statement.

Fuad said that the information was issued to clarify any
confusion on the fiscal status of incomes obtained from interest
on time deposits and other savings, and how they are to be
computed on tax returns.

In the statement, the tax director general emphasized that the
calculation for income tax on the interest from time deposits,
savings and Bank Indonesia Certificates (SBIs) is still based on
the government's regulation No. 51/1994. The income tax on
interest, at a flat rate of 15 percent, is not included on tax
returns, according to the regulation.(hen)