Megawati asks tax office to improve image

Urip Hudiono, The Jakarta Post, Jakarta

President Megawati Soekarnoputri has asked the Ministry of Finance's Directorate General of Taxation to further improve its image, and continually strive to increase state revenue from taxes.

"We are still hearing of taxpayers who meet with tax officials to negotiate (illegal) settlements of their taxes," she said during a ceremony on Tuesday marking the filing of their annual tax returns (SPT) by top politicians and state officials.

Besides Megawati, other top state officials who also filed their SPTs during the event were the speaker of the People's Consultative Assembly (MPR) Amien Rais, Vice President Hamzah Haz, Chief Justice Bagir Manan, Constitutional Court President Jimly Asshiddiqie, Supreme Audit Agency (BPK) head Satrio "Billy" Budiharjo Joedono, and Minister of Finance Boediono.

Such adverse comments, however, should not dishearten tax officials, Megawati continued, but should instead encourage them to improve their performance.

"So in the end, people can rest assured that the taxes they have paid are turned over to the state and are used for the benefit of the public at large," she said.

The tax office has long been seen as one of the most corrupt institutions in the country. The government is currently carrying out a reform program aimed partly at curbing corruption there.

Megawati also asked the Directorate General to further increase tax collection, saying that this was essential if Indonesia really wanted to fully finance its state budget without having to resort to foreign borrowing.

Commenting on the President's request, Director General of Taxation Hadi Purnomo said that his office was determined to raise tax revenue by increasing the number of taxpayers by an average of 100,000 per year.

"We will also continue to take resolute legal action against tax evaders, including detaining them if necessary, and imposing sanctions on corrupt tax officials," he said.

Hadi explained that his office had set itself a revenue target of Rp 216 trillion (US$25.4 billion) from taxation this year, contributing about 13.5 percent to Indonesia's gross domestic product (GDP).

Last year, revenue was Rp 192 trillion, and contributed 11 percent to the country's GDP.

Tax revenue during the January to February period of this year reached Rp 29 trillion.

Previously, an expert advisor to the Directorate General, Djangkung Sudjarwadi, explained that accumulated tax arrears as of January stood at Rp 26 trillion.