Twenty-percent share ownership

Minister of Cooperatives and Small Enterprises Subiakto Tjakrawerdaya has quoted President Soeharto's appeal to limit the purchase of shares of companies which have gone public to 15 percent, in order to prevent someone or a certain group from becoming a majority shareholder.

However, PT Nusamba, led by Bob Hasan and whose shares are predominantly owned by the Super Semar Foundation, now owns about 22.5 percent of PT Astra International shares. This is not in violation of the prevailing capital market regulations, i.e. the Capital Market Law, which state that the purchase of a company's shares equaling or exceeding 20 percent is allowed, provided it is done in a transparent way: that it is registered officially at the stock exchange. This method is called the "tender over". What is prohibited is the covert purchase of shares, or what is referred to as "insider trading", which may cause losses to public shareholders.

The law is also clear on the matter regarding the authority of the Capital Market Supervisory Agency, which sends a warning if there is a share purchase which is viewed as insider trading.

The Indonesian capital market has existed for eight years. The stock exchange still needs to win the community's confidence. There should not be an impression that capital market regulations can be changed arbitrarily, according to the wishes of state officials.

It would be a good thing if the finance minister, in his capacity as the authorized and responsible state official on the running of the capital market in Indonesia, clarified the matter. He should not keep mum. He should not take an attitude of "silence is golden".

Of late, there has been a tendency on the part of the government to ignore the laws in the financial field. One example is Presidential Instruction No. 6 of 1996, which gives tax exemption to PT Timor Putra Nasional. The tax laws in force clearly do not recognize the granting of tax exemption facilities, both subjective and objective. The granting of tax facilities to PT Timor Putra Nasional only is discriminatory. In implementing tax laws as public law, discriminatory steps are prohibited. Although the granting of the facility is formulated as tax debt borne by the state, it means that the government has given tax subsidies to PT Timor Putra Nasional. Tax subsidies have to be mentioned and accounted for in the State Budget and approval for them obtained from the House of Representatives (see Article 23 of the 1945 Constitution). The finance minister needs to explain the matter. The House should also give attention to it, particularly the commissions for state budget and finance. The Supreme Audit Agency should also have a say in it. Another matter is the issuance of a Presidential Decision which grants income tax exemption to PT PAL (a state-owned company) in Surabaya.

If the government has provided examples of discriminatory steps in implementing the tax laws, perhaps it may lead to the unwillingness of many taxpayers to adhere to the prevailing tax laws.

SUHARSONO HADIKUSUMO

Jakarta