'No compromise for tax evaders'

Bambang Nurbianto, The Jakarta Post, Jakarta

Vice Governor Fauzi Bowo said on Thursday the city would not compromise with 774 tax evaders whose cumulative tax arrears since 1987 total about Rp 58.5 billion.

Fauzi said it the administration would no longer tolerate those parties who failed to pay their taxes.

He added that tax problems should be resolved through existing regulations.

"What compromise? The regulations are very clear. We will resolve the problems based on existing regulations," Fauzi said after a seminar on the revision of Law No. 34/1999 on the special administration of Jakarta as the capital.

The head of the City Revenue Agency, Deden Supriadi, announced last week the names of tax evaders from four business sectors: hotels, restaurants, entertainment venues and advertising companies.

Deden said that on July 1, his office would issue a letter to demanding these companies pay their tax arrears. The companies will be given until the middle of next month to pay the taxes or risk having their assets seized.

The city administration is taking action based on Law No. 19/1997 and the revised Law No. 19/2000 on the forceful collection of taxes.

The law also authorizes the administration to put the seized assets up for auction if the tax arrears are not paid.

Sahid Jaya Hotel, one of the companies named by the city administration last week, is seeking a "peaceful" solution to its tax problems.

The hotel's president director, Hariyadi B. Sukamdani, told the press that the hotel and the administration had different calculations on how much in back taxes were owed by the hotel.

According to the hotel, it owes Rp 928 million, but the City Revenue Agency puts that figure at about Rp 13.26 billion.

Fauzi said tax arrears were an old problem. "It's time for the city administration to crack down on tax evaders."

Hotel Sahid spokeswoman Sri Ayuningsih said on Thursday that the hotel had invited city officials to discuss how to resolve the problem peacefully.

"We have invited city administration officials to discuss the matter in order to seek a win-win solution, but so far they have refused to discuss any different calculation," Sri told The Jakarta Post. She added that the hotel management would not insist on its own calculation.