Tangerang mayoralty recieves less in tax revenue

Tangerang mayoralty recieves less in tax revenue

TANGERANG (JP): The mayoralty's annual income from hotel and
restaurant tax dropped by half from Rp 20.78 billion (US$2.73
million) in 1997 to Rp 10.4 billion this year, an official said
on Monday.

The head of Tangerang revenue office, Agus Burhanudin, said
the drastic plunge in revenue was mainly due to the prolonged
economic crisis and the extensive damage to hotels and
restaurants during the mid-May riot in the area.

Implementation of Law No. 18/1997 also played a large role in
trimming tax revenue from hotels and restaurants in the area,
Agus said. The law states that if a company pays value-added tax
it does not have to pay the local government hotel and restaurant
tax.

One of the major contributors, PT Aerowisata Catering Service
at Soekarno-Hatta International Airport, stopped its annual
payment of Rp 4 billion to the mayoralty in line with the
implementation of the law, he said.

"After the law was put into effect, Aerowisata Catering
Service no longer had to pay hotel and restaurant tax," Agus
explained.

The mid-May riots that spread to Tangerang, located west of
Jakarta, caused the mayoralty Rp 3 billion in lost tax revenue as
many businesses could no longer operate due to severe damage, the
official said.

At least 300 shops, restaurants, hotels and shopping centers
were damaged by mobs during the three-day riots, Agus said.

For the remaining three months of the ongoing fiscal year, his
office has predicted it would collect Rp 7 billion, or 43 percent
less than the previous corresponding period during which the city
managed to acquire Rp 13.78 billion from 134 taxpayers.

According to Agus, who was accompanied by the head of the
Tangerang revenue office, Rochimin Sasmita, his office will
cooperate with the local tourist office to increase the
mayoralty's revenue by collecting taxes from enterprises who
should obtain permits from the tourist office.

Rochimin said some department stores in his area, such as in
Pamulang, Ciputat and Curug districts that were extensively
damaged during the May riots have gradually resumed business.

His regency expects to collect some Rp 4 billion from hotels
and restaurants during the 1997/1998 fiscal year, compared to Rp
7 billion obtained the previous fiscal year.

"The last count in mid-December shows that our revenue will
reach Rp 3 billion. We estimate that by the end of the fiscal
year in April 1999, we could accumulate up to Rp 4 billion,"
Rochimin said. (41/ivy)