Travel ban imposed on declinquent taxplayers

Travel ban imposed on declinquent taxplayers

Fitri Wulandari, The Jakarta Post, Jakarta

Three foreigners and two Indonesian businessmen have been
barred from leaving the country for failing to pay the
multibillion rupiah tax arrears of their companies.

Gunadi, director of tax inspection at the Directorate General
of Taxation, said on Thursday the travel bans had been imposed by
the immigration office on the five company executives at the
request of the directorate, to force them to pay up.

He said the move was line with the directorate's internal
circular dated April 22, 2002, which allows the directorate to
take tough measures against delinquent taxpayers, including
asking for travel bans and revealing their identities to the
media.

However, the directorate refused to disclose the full
identities of the five businessmen, providing only their
initials.

"We cannot reveal their identities fully because they might
sue us," he said.

The five businessmen were identified as Mr. BMS and Mr. G --
president director and manager respectively of PT ESPMI; Mr. MMG,
managing director of BUT IPR (Java) Ltd; Mr. ASR, managing
director of PT NDME and Mr. HK, president director of PT PAC.

Mr. BMS, Mr. G, and Mr. MMG are Canadian, U.S., and British
citizens respectively. PT ESPMI owes tax amounting to Rp. 42.86
billion (around US$4.76 billion), BUT IPR owes Rp. 45.87 billion,
PT NDME Rp 391 billion and PT PAC Rp 1.97 billion.

Head of the tax collection division Djangkung Sudjawardi said
the three expatriates had been barred from leaving the country
since April this year, and the Indonesians from September this
year.

They had withheld payment of their company's taxes three to
four years ago.

Of the four company taxpayers, only PT ESPMI has started to
pay its tax arrears by installments.

"But as it hasn't yet cleared its tax arrears, the travel bans
are still in effect," he said, adding that thus far, the company
had paid Rp 15 billion of a total Rp 42.86 billion in tax
arrears.

As for the rest, he said, the tax office would wait until the
end of this month for the three companies to respond to the
summons.

"If they fail to show up, we will commence an investigation
into tax crime and take them to court," he stressed.

"Moreover, we shall seize their assets, such as properties and
vehicles, as well as block their bank accounts," he said.

Djangkung added that in the case of the foreign taxpayers, the
taxation office had contacted their respective embassies.

The directorate also announced that as of August this year,
tax arrears had reached Rp 19.6 trillion and US$ 15.1 million.
The figures, including individual and company taxes, were the
cumulative amount over the past ten years.

Of the total, Rp 5.5 trillion and $14.6 million was owed by
foreign investors, foreign agencies and individuals and publicly
listed companies.

Another Rp 3.7 trillion was payable by companies categorized
as large taxpayers, including local and foreign companies.

The remainder was payable by nonlisted local companies and
individuals.

Djangkung asserted that the directorate general aimed to
recoup at least 25 percent of tax arrears this year.