New bill pushes for local collection of gasoline taxes
New bill pushes for local collection of gasoline taxes
JAKARTA (JP): The government has introduced a bill which
would, for the first time, allow local administrations to collect
gasoline taxes at a maximum rate of 5 percent.
The new tax is stipulated in a bill on local taxes and fees
which was unveiled by Minister of Finance Mar'ie Muhammad
yesterday at the House of Representatives.
Mar'ie presented the bill with three other bills on tax on the
transfer of land and buildings, tax collection with distress
warrants and tax courts.
"The four bills have an important and strategic role to
provide a fair and clear legal foundation in tax collection,"
Mar'ie told the House's plenary session.
The bill on local taxes and fees sets the maximum rates for
vehicle tax and gasoline tax at 5 percent, and 10 percent for the
transfer of vehicle ownership.
"The gasoline tax will be a new income source for both regency
and provincial administrations. This tax has great potential
because fuel consumption keeps increasing every year," Mar'ie
said.
Although the gasoline tax will be under the provincial
administrations' jurisdictions, 80 percent of gasoline tax
receipts will go to regencies, Mar'ie said.
The bill on local taxes and fees also sets maximum rates for
six regency taxes: 10 percent for street lighting tax, hotel tax
and restaurant tax; 20 percent for the extraction and processing
of minerals tax and the exploitation of land water tax; 25
percent for billboard tax; and 35 percent for entertainment tax.
The bill also governs the kinds of fees which can be imposed
by local administrations, including those on public, commercial
and licensing services.
The imposition of fees by local administrations should be
approved by the Minister of Home Affairs in consultation with the
finance minister.
The bill on tax on the transfer of land and buildings
stipulates that any transfer of land title and buildings worth
more than Rp 20 million (US$8,460) is subject to a 5 percent tax.
"The imposition of this tax is expected to reduce land
speculation," Mar'ie said.
The bill on tax collection with distress warrants empowers tax
collectors to issue distress warrants, confiscation letters and
debt-bondsman warrants.
A distress warrant can be issued if a taxpayer cannot meet his
tax obligation on time. Confiscation letters can be produced 24
hours after the issuance of distress warrants. A debt-bondsman
warrant can only be issued with the consent of the finance
minister or the head of a local administration.
The tax office can also prevent a person with a tax debt of at
least Rp 100 million (US$42,300) from leaving Indonesia for up to
six months. This period can be extended twice.
The bill on tax courts governs the establishment of a tax
court in Jakarta and, if necessary, tax courts elsewhere in
Indonesia.
"The tax court will settle disputes in the field of tax which
have recently been on the rise," Mar'ie said.
He said the court would handle disputes such as taxpayers'
objections to decisions taken by tax officials and complaints
about the levying of taxes.
The tax court will replace the current Tax Arbitration
Council, which has been deemed ineffective in settling tax
disputes, Muhammad said, adding that it would be based in
Jakarta.
According to the bill, the head, deputy and other judges of
the tax court would be appointed by the President for a five-year
term extendible for another five years.
The draft law also stipulates that taxpayers must first pay
the disputed taxes even though they intend going to the tax
court.
The plaintiffs must also pay a court registration fee of Rp 1
million before their cases can be heard.
The registration fee is imposed to ensure that the cases to be
presented are significant, and to facilitate the court's
administrative process, Mar'ie said. (rid)