KPK, tax office sign MoU on fighting corruption

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.