Tax offices claim property tax hike a result of calculating errors

Rendi A. Witular, The Jakarta Post, Jakarta

Rocketing property tax in Jakarta, which has recently upset many taxpayers, has been called a "miscalculation or wrong data given by tax officials" at the mayoralty tax offices.

Director of property tax at the Ministry of Finance, Suharno, told The Jakarta Post on Wednesday that the Directorate General of Tax had only imposed an increase of 5 percent of property tax since Jan. 1. The hike, he claimed, was disseminated by the city administration last year.

"The increase is not meant for the general public but for business centers and luxury residences only. If the hike appears too high from the percentage, it is probably caused by a miscalculation or the wrong data being given by a tax official," he said.

The good news is taxpayers can make a complaint, claiming that the increase is an error. Unfortunately, those who do not inform the office of the miscalculation will not get their money back.

"All we can do now is to appeal to the public to report any unexplainable hikes to the complaint division at each mayoralty tax office. We won't be able to investigate the errors without their report," Suharno said.

When the Post visited several tax offices, no signs or announcements explaining the procedure to challenge the hike were posted. There was no information included on the tax brochure.

One taxpayer, Agus Dharmono, asked several officials at the West Jakarta tax office on Jl. K.S. Tubun, Central Jakarta, before finding the complaint division for filling in the form objecting to the increase. Agus must pay Rp 2.2 million (US$220) this year, a 300 percent hike from last year's total of Rp 700,000.

Officials explained that should a taxpayer not get a satisfactory answer for his complaint, he should bring the matter to court.

Despite objections from taxpayers, Suharno said his office must carry out the increases in tax based on the results of a survey conducted by the assessment division of each mayoralty tax office.

He also said that the administration was not in a position to reject the hike.

"Governor Sutiyoso doesn't have the right to reject the plan. The administration only carries out tax collection and is not involved in policy-making. This is just between the tax directorate and the taxpayers. We usually just inform the governor on the hike, which we already have," he said.

Suharno also suggested those taxpayers who object to the hike to protest or consult with the complaint division of the office before August.

The tax assessment was based on two categories of property, land and building. The sale value (NJOP) was calculated on the assessment of the width and value of the property, which was based on the market value of the area.

Land located on a strategic main road, such as Jl. Sudirman in Central Jakarta, was valued higher than land on Jl. Bulevar Kelapa Gading, North Jakarta. The difference being that Jl. Sudirman is a commercial business area, while Jl. Kelapa Gading is residential.

A survey team from each mayoralty office was deployed last April to assess every road and residential area, including taking pictures of each building, to plan for an increase of property tax for the next year.

But an official at the Central Jakarta tax office, who asked for anonymity, told the Post that the survey team lacked personnel. Therefore, the building or land assessment was conducted arbitrarily without an adequate survey.

This year alone, the Directorate General of Tax is projected to earn Rp 5.9 trillion from property tax, a Rp 900 million jump over taxes collected last year. There are about 1.6 million taxpayers throughout the capital.