KPK, tax office sign MoU on fighting corruption

Urip Hudiono, The Jakarta Post, Jakarta

The Corruption Eradication Commission (KPK) has taken another step toward controlling graft within the Ministry of Finance by signing a memorandum of understanding (MoU) with the ministry's Directorate General of Taxation on Wednesday.

The MoU gives the KPK full access to all the data from within the tax directorate that it might require to pursue its investigations into likely incidence of corruption.

"Actually, we already have the legal basis to access the data. But there was a bureaucratic loophole in the procedures as we had to seek permission first from the finance minister," KPK chairman Taufiqurrahman Ruki told reporters after the MOU-signing ceremony.

"We have agreed to cut through that red tape. So, from now on the KPK can come directly to the tax office and inquire about or search for any data that we need ourselves."

The MoU would also support the KPK's recent moves to cleanse the ministry of corruption following the signing of similar MoUs with the ministry's Inspectorate General and the Directorate General of Customs and Excise earlier this week.

The customs and tax offices were named by Transparency International Indonesia in a recent survey as respectively the most corrupt and the 11th most corrupt institutions in the country.

Ruki further said that the KPK would use the MoUs to strengthen its hand in directly prosecuting officials within the ministry who were suspected of involvement in corruption.

"Before the MoUs were signed, we had already been advising the ministry to continuously improve its internal management system, as well as the state budget system," he said.

"This is not a threat, but we will no longer tolerate any violations of the procedures that have been put in place."

Law No. 30/2003 on the KPK gives it wide-ranging powers in corruption cases, including the powers of prosecution that were previously vested solely in the police and public prosecution service. The commission also has the power to summon civil servants, state officeholders and legislators without seeking the approval of the president and to take over of the handling of corruption cases from the prosecution service or the police.

With regard to tax issues, Ruki said the KPK had observed two main problems: discrepancies in tax payments and embezzlement of tax refunds.

"There are many reports of tax officials making backroom deals with taxpayers for their own benefit," he said. "The KPK has also received complaints about poor service provided by the tax office to the public."

Ruki did not say, however, whether the KPK had started to investigate the reports.

The KPK had previously asked Minister of Finance Yusuf Anwar to sign a "contract" with Director General of Taxation Hadi Purnomo and Director General of Customs and Excise Eddy Abdurrachman, in which all involved would have to step down if they proved incapable of improving performance among their subordinates, including the stamping out of corruption.

Yusuf said he was in the process of setting up a special internal committee to monitor the performance of the taxation, and customs and excise offices.

"We are currently selecting its members," he said, adding that the President had explicitly ordered a shake-up to improve the performance of the two key offices.