Supporting State Revenue, POPSI Requests Methodology for Proving Underinvoicing

The Indonesian Palm Oil Farmers Organisation (POPSI) is questioning the calculation methods related to underinvoicing, urging that they not be based solely on assumptions. The practice of underinvoicing is said to cause the state to lose Rp 500 trillion to Rp 600 trillion in revenue per year. POPSI Chairman Mansuetus Darto fully supports the government’s efforts to increase state revenue, strengthen international trade governance, and take action against any legally proven violations. However, he stressed that any strategic policy with the potential to alter palm oil export trading arrangements must be built on strong evidence and transparent methodology. ‘We support increasing state revenue and law enforcement against anyone proven to have committed violations. However, if a claim is used as the basis for major changes in export governance, then the methodology, data sources, and the process of proof must be openly disclosed to the public,’ Mansuetus said in a press release in Jakarta on Wednesday. He assessed that claims regarding potential state revenue losses due to underinvoicing, transfer mispricing, or other forms of irregularities need to be accompanied by further explanation. This concerns the calculation methodology, data sources, economic assumptions, validation processes, and the legal basis used. Mansuetus stated that such transparency is important so the public can objectively assess the urgency of the proposed policy changes. POPSI also reminded that transfer pricing, transfer mispricing, and trade misinvoicing are distinct concepts.