State treasurers lax on tax collection: Fuad

JAKARTA (JP): Many treasurers of government offices either omit to pass on tax payments made by government suppliers or help those contractors to pay less tax than they owe, according to Tax Director General Fuad Bawazier.

Fuad said yesterday that such illegal practices had resulted in great losses to the state, although he did not provide details of the amounts involved.

Treasurers of government offices are responsible for collecting taxes from companies with which they are involved in carrying out government projects.

The tax director general said that few government-employed treasurers achieved the minimum tax collection targets set for them. He added that, roughly-speaking, the tax revenue target from government projects was 1.5 percent of the projects' value.

Fuad said that in the current 1995/1996 fiscal year, the tax directorate general expected to raise Rp 450 billion (US$ 204.54 million) in tax revenue from government projects, the value of which was estimated to be Rp 30 trillion ($13.5 billion), he said.

"Many state-employed treasurers seem to forget to collect the taxes required from those involved in government projects," Fuad said in an address at the opening of a two-week taxation workshop.

Fuad said that, while many treasurers of government offices did collect the relevant taxes, the amounts which they deducted from payments made to private contractors were often well below what was due.

"Others do collect the taxes in accordance with the procedures but then delay in passing the revenue on to the tax office," he told the workshop, which is being held especially for treasurers of government offices all over Indonesia.

Fuad said that the government planned to impose stiffer penalties on recalcitrant treasury officials in order eradicate the corrupt practices.

"Government offices will be responsible for disciplining their respective treasurers," he said.

During the 1994/1995 fiscal year, ended in March, 11 officials of the tax directorate general have been dismissed on the grounds of corruption and more than 150 others have received harsh punishments, Fuad said.(hen)