President's men given tax awards
Rendi A. Witular, The Jakarta Post, Jakarta
President Megawati Soekarnoputri attended a glamorous ceremony on Wednesday to present awards to the country's 262 most compliant individual and corporate taxpayers, some of whom she knew intimately.
The winners included her husband, Taufik Kiemas, her brother, Guruh Soekarnoputra, and the publicly-listed Bank Mandiri.
Her own name, however, was not on the list.
Megawati personally presented the awards to some of the recipients, including prominent Muslim cleric Abdullah "Aa Gym" Gymnastiar and Bank Rakyat Indonesia (BRI) president Rudjito.
The Directorate General of Taxation, the organizer, put its director general, Hadi Purnomo, and Minister of Finance Boediono, who oversees the taxation office, on the top list. The list of individual taxpayers was dominated by Cabinet ministers and top government officials.
The reason for their choice was not clear because most government officials including ministers have income tax automatically deducted it from their monthly salaries -- not requiring any extra special compliance.
Vice President Hamzah Haz, the House of Representatives (DPR) Speaker Akbar Tandjung, the People's Consultative Assembly (MPR) Amien Rais also received the honors.
Other officials and legislators granted the award were Jakarta Governor Sutiyoso, Supreme Court Chief Bagir Manan, Attorney General M.A. Rachman, legislators Tjahyo Kumolo, Panda Nababan, and Lambok V. Nahattans, an official at the State Secretariat.
Minister Boediono said the event was aimed at enticing the public to pay their taxes on time, and honestly fill in their tax report.
"This award is part of the government's effort to reform the country's tax system... It is expected to encourage other taxpayers to comply with the regulations," said Boediono.
The government had set strict qualifications for the individual and corporate taxpayers to be eligible for the award, including paying their taxes on time within the last two years, he said.
The recipients were not allowed to be involved in tax crimes during the last 10 years, and must have no tax arrears, Boediono said.
As for corporate taxpayers, an additional financial report audited by an independent auditor with an "unqualified" result was also needed, he said.
The government in return will grant obedient taxpayers with an accelerated tax refund, reducing the normal period of six months to only two months for income tax and seven days for value-added tax.
For corporate taxpayers, the government will simplify the procedure of paying excise and speed up import and export clearance.
Among the companies awarded are state-owned Bank Mandiri and Bank Rakyat Indonesia, PT Astra International, PT LG Electronic Indonesia, PT Newmont Nusa Tenggara, PT IBM Indonesia, PT Unilever Indonesia, PT Jawa Pos, PT Nusamba and PT Kalbe Farma.
In the category of corporate taxpayers, the list of Japanese companies as recipients is significant, including PT Nissho Iwai International Indonesia, PT Sarinitokyu Hotel International, Komatsu Indonesia and Bridgestone Tire Indonesia.
The award for Bank Mandiri was controversial, since the bank was accused of evading taxes worth Rp 2.2 trillion (US$261 million) in 2000, before the government eventually decided to exempt it from paying the taxes in 2003.
Top singers such as Malaysian Siti Nurhaliza and local singers Harvey Malaiholo, Sherina, Titik Puspa and Tantowi Yahya were invited to entertain the guests.
The event was held at the Jakarta Convention Center's plenary hall, which was recently used to host U.S. singer Mariah Carrey.
A source at the tax directorate said that around Rp 1 billion (US$1.1 million) was spent on the event.