Tax fraud defendants may get 14 years in jail

Tax fraud defendants may get 14 years in jail

JAKARTA (JP): Prosecutors yesterday demanded that four men
indicted of tax evasion each be sentenced to 14 years
imprisonment at a court here.

The prosecutors also demanded that each defendant compensate
the state, with amounts ranging from Rp 10.5 billion to Rp 10.9
billion in addition to a Rp 30-million fine each.

The four are charged with masterminding and establishing
companies to issue fictitious value-added tax invoices, sold for
between 6 percent to 30 percent of their face value between March
1995 and June 1995.

Suspect Hartono, 46, and Raden Ignatius Suarisman, 57, are
being tried by a team of judges led by I.G.K. Sukarata while
suspect Baharuddin Umar, 46, and Tonny Effendy, 31, are being
tried by team of judges led by Sartono.

Prosecutor M. Djaenuddin Nare are charging that Hartono and
Suarisman have cost the state a loss of some Rp 46 billion in tax
revenues.

This is lower than Rp 58.3 billion originally mention in an
earlier indictment based on 12,500 bogus VAT invoices allegedly
issued by 31 firms established by the four suspects.

However, Djaenuddin said only 26 companies were proven to have
been involved in selling VAT invoices.

In a separate hearing, prosecutor R. Moekiat charged that
suspect Tonny and Baharuddin caused the state a loss of some Rp
44 billion in tax revenues.

Approximately 142 witnesses have been heard in 23 court
hearings, which started in March.

Entrepreneurs are obliged to collect 10 percent in value-added
tax when consumers make purchases. The difference between
incoming and outgoing taxes collected by entrepreneurs is the
amount deposited with the state as value-added taxes.

Entrepreneurs exporting goods are entitled to claim back the
amount of tax deposited with the state when the goods are
exported.

Previous hearings revealed that companies established by the
four suspects fulfilled most of the legal procedures and are
actually allowed to issue tax invoices.

The invoices became invalid because no real sales occurred.

Prosecutors also demanded that the suspects' property
allegedly gained from the scheme be confiscated, including
vehicles and houses.

Prosecutors took turns reading the 339 pages and 459 pages of
charges at the Central Jakarta district which lasted two-and-a
half and four-and-a-half hours respectively.

Defense statements of suspect Baharuddin and Tonny will be
heard next Tuesday while Hartono and Raden's will be on June 25.
(14)