ISEAI: Military Involvement in Tax Oversight Risks Intimidating Taxpayers

The Indonesia Strategic and Economic Action Institution (ISEAI) has assessed that the involvement of village supervisory non-commissioned officers (Babinsa) and community security and order supervisors (Bhabinkamtibmas) in monitoring taxpayer compliance has the potential to create fear or discomfort among taxpayers. Senior Analyst Ronny P. Sasmita stated that the public’s perception of the presence of security forces could influence how they respond to tax policies. He noted that the TNI and Polri hold a strong position in the social structure, so their presence, even without performing tax audit or law enforcement functions, can still have a psychological effect on taxpayers, especially small business owners and ordinary citizens. “Formally, they are not conducting audits or law enforcement,” Ronny told Tempo on Tuesday evening, 21 July 2026. However, for small business owners or ordinary people, the situation could feel as if the state is approaching them with full force. He warned this is dangerous because healthy tax compliance should be built on trust, not implicit pressure. Ronny said the government needs to prepare clear guardrails to ensure the policy is not perceived as a form of intimidation. The role of Babinsa and Bhabinkamtibmas must be limited to administrative assistance and should not involve direct interaction with taxpayers in a tax-related context. He also assessed that the Directorate General of Taxes needs to strengthen public communication by openly explaining that the presence of these officers is solely for administrative support, not for tax supervision or law enforcement. Ronny further encouraged the tax authority to provide an easily accessible complaints mechanism for citizens who feel intimidated during the policy’s implementation. He noted that the risk of abuse of authority could arise not from the policy’s intent, but from dynamics in the field. He also proposed that the government conduct periodic evaluations and convey the results to the public to ensure the policy is implemented accountably. Ronny stated that the main challenge of the policy lies not in the government’s formal explanations, but in the potential emergence of a trust deficit in society. In tax policy, public perception is just as important as the substance of the policy because public discomfort can render a technically sound policy counterproductive. Director General of Taxes Bimo Wijayanto asserted that the involvement of Babinsa and Bhabinkamtibmas is not to perform tax audit or collection functions, but merely to support coordination in information gathering. “So village officials and the like coordinate with us, not that they are narrated as executors of tax audits or collections, absolutely not,” Bimo said during the July 2026 APBN KiTa press conference. The issue arose after the Directorate General of Taxes issued Circular Letter Number SE-8/PJ/2026 concerning Guidelines for Taxpayer Compliance Supervision. He explained that the presence of territorial elements is not the primary instrument in taxpayer compliance supervision. Instead, the tax authority currently relies more on technology, such as Coretax and geotagging-based monitoring. “So their presence there supports joint coordination, and even that is not the main ‘weapon’. Our main weapons are more sophisticated, we use our CRM (compliance risk management) machine, we use our geotagging surveillance, we use our Coretax. If clarification is needed, of course, there are territorial supervisors in the area,” he said. Bimo mentioned that this mechanism is not a new policy, as it has been regulated since 2020. The latest circular only refines the implementation procedures.