Tax Amnesty Participants Won’t Be a Priority
JAKARTA, KOMPAS – The Directorate General of Taxation (DGT) has pledged to prioritize taxpayers who did not join the tax amnesty program in its legal enforcement measures against tax evaders. The taxpayers who took part in the tax amnesty program will not be a priority.
Speaking at a press conference in Jakarta on Monday, Finance Minister Sri Mulyani Indrawati said the government would continue with the tax reform agenda after the tax pardon program.
The tax reform team, which has recently been formed, has prepared a number of short-term agenda and law enforcement measures as the focus of the reform program. At the same time, the DGT will be encouraged to improve itself.
"The goal is to increase tax revenues without creating uncertainty in the business world. The working system will be streamlined, precision will be enhanced and legal certainty will be improved,” she added.
Suryo Utomo, an expert in tax compliance at the Finance Ministry, said on the same occasion that the DGT had a lot of data about the Indonesian citizens who did not have taxpayer identification numbers (NPWP) and who did not participate in the tax amnesty.
"A lot. There are hundreds of thousands of data points, related to ownership of stocks, vehicles, land and other assets," Suryo added.
After the tax amnesty program ended on March 31, Suryo said the DGT would further validate the data. The goal is to increase the tax base and at the same time raise tax revenues.
In addition to data, Suryo added that the tax officials in some areas would also carry out field observations to monitor assets owned by citizens who do not have an NPWP. "This will be part of the follow-up programs," Suryo said.
Based on data from the DGT, the number of tax amnesty participants totaled 965,983 people, while the number of newly registered taxpayers during the tax amnesty program reached only 50,385 people. Others were taxpayers who had registered before the tax amnesty.
In fact, there are many citizens who meet the criteria to pay taxes, but have yet to be registered with the DGT. Many of those who have registered still do not submit tax returns, report their income tax or properly pay their taxes.
Of about 60 million Indonesians who have taxable incomes, only 36 million are registered as taxpayers. The number of taxpayers who report their income tax returns every year is very small. In 2016, for example, only 9 million taxpayers submitted their 2015 tax returns. It is almost certain that not all of the people who submitted their tax returns paid taxes properly.
Having data
The director for tax extension and assessment at the DJP, Dasto Ledyanto, said the DGT held data on citizens who did not take part in the tax amnesty and those who did not pay their taxes correctly. The data is stored at the DGT Data Center.
"We\'ve been combining some data. We will follow them up soon. We\'ve got 2.5 years from now to do the jobs. In principle, for those who did not follow the tax amnesty and did not pay taxes, there will be the consequences," Dasto said.
The provisions for tax evaders who did not join the tax amnesty are stipulated in article 18 of Law No. 11, 2016 on Tax Amnesty. In essence, if the assets of taxpayers acquired between Jan. 1, 1985 and Dec. 31, 2015, were not reported in income tax returns, the DGT considers them additional income received at the time the data is found.
Furthermore, on the additional income, the DGT will impose taxes and penalties in accordance with the provisions outlined in existing tax regulations. This provision is valid for a period of three years after the tax amnesty program was held.
Sofjan Wanandi, representing employers in the Tax Reform Team, said groups of entrepreneurs who participated in the tax amnesty program should not worry that they would become the primary target of law enforcers. He believes the government will maintain public trust.
"I think there is an agreement that the priority will be given to those who did not participate in the tax amnesty," Sofyan said.
Fund repatriation
Meanwhile, the chairman of the Board of Commissioners at the Financial Services Authority (OJK), Muliaman D Hadad, said the OJK would continue to monitor the repatriation of overseas funds collected from the tax amnesty program.
"The coordination between the OJK and the DGT has improved, especially in monitoring the repatriation of funds that should be kept in Indonesia. We will continue to monitor them, especially because there are rules that the funds must stay in Indonesia at least three years," Hadad said Monday in Jakarta.
Based on the observations of the OJK, most of the repatriated funds are placed in local banks in the form of deposits and current accounts. Bhima Yudhistira Adhinegara, a researcher at the Institute for the Development of Economics and Finance (INDEF), said many people were reluctant to repatriate their funds from overseas because of the lack of investment options that can give them fair returns.
Aspects of business and investment procedures have become handicaps. So, even though the funds have already been repatriated, they have yet to enter the real sector. In addition, many taxpayers who want to repatriate their funds need time to sell their assets overseas. Property or vehicles take longer to sell and deposits cannot be withdrawn before their maturity dates
"Following the increase in the benchmark interest rate at the US central bank, the interest rate on deposits in a number of countries, notably Singapore, also rose. Indeed, they always say there is no significant increase in deposit rates. It is true. However, it does not include those in special promotion program," he added.
(CAS/ HEN/ CAS/JOE)