Major taxpayers urged to give more to the poor
Major taxpayers urged to give more to the poor
JAKARTA (JP): The government is drumming up support for a new presidential decree which calls on big corporate and individual taxpayers to contribute more to the campaign to eradicate poverty.
Presidential Decree No. 90/1995 calls on individuals who earn more than Rp 100 million (US$43,000) after income tax to donate up to two percent of their surplus to a new fund for the poor.
Minister of Population/Chairman of the National Family Planning Board Haryono Suyono quoted President Soeharto as saying yesterday that contributions from people who earn less than Rp 100 million will also be welcomed.
"The President Soeharto asks all investors, both domestic and foreign, to help make the scheme a success," Haryono told journalists after meeting with the President.
The government expects the revenue resulting from the decree to raise at least Rp 250 billion a year for a poverty eradication fund.
According to official figures, an estimated 25 million of Indonesia's 195 million people still live in poverty.
The government draws the poverty line on the basis of a minimum daily calorie intake of 2,100, and a certain quantity of non-food consumer goods and services.
Haryono said the funds will be channeled to about 11.5 million impoverished families in areas uncovered by the government's assistance for underdeveloped villages or Inpres Desa Tertinggal.
The contributions from the wealthy donors will be channeled through the state-owned Bank BNI, in the form of business loans with an interest rate of between 6 and 10 percent, he said.
Business consultant Laksamana Sukardi and businessman Adiputra Tahir welcomed the government's move, although they differ on how the new Decree should be implemented.
Laksamana said he does not have the slightest doubt about all the good intentions behind the decree, but he pointed out that much needs to be finalized to make it workable.
"It is a good move to make more equitable distribution of the development cake. The challenge is that the government has to make the implementation accountable to the public," he said.
The government should include the donation for the poor in the state budget so that it will be open for scrutiny by state supervisory bodies, such as the Supreme Audit Agency and the House of Representatives.
"Otherwise, the scheme will only create more problems and room for irregularities," said the former banker who is now a politician affiliated to the Indonesian Democratic Party (PDI).
Laksamana also questioned why the scheme is regulated by a Presidential Decree and not by a law, which requires the involvement of the House of Representatives.
He warns that the ambiguous rules of the decree will make the scheme an additional burden to businesses, who already have to pay various taxes.
Laksamana said the decree overlaps with the law on taxes and the implementation can cause confusion.
Meanwhile, businessman Adiputra Tahir said he expected no major hurdles in the implementation of the scheme because he believes the government already has a clear concept.
"The donation scheme is an excellent idea," said the former chief of the Association of Indonesian Young Entrepreneurs. "It needs some kind of sacrifice from the haves to help the poor."
The wealthy, he said, has the social duty to help their poor compatriots to improve their living standard.
"I hope that (rich) people are honest about their wealth. No one should conceal their fortune to avoid their social duty, which is to help the poor," he said. (pan)