Opinion and Solutions on Article/News Economic in Indonesia " Tax Avoidance"

Indonesia’s Investment Coordinating Board (BKPM) is warning it will annul the investment permits of foreign companies that are proven to be avoiding payment of taxes.

"We are ready to revoke the principal licenses, but to prove a transfer pricing, as a tax-avoidance practice, is not the BKPM's job. It is the tax office that will hold the investigation, then deliver the results to the BKPM," chairman Franky Sibarani told thejakartapost.com on Monday in Jakarta.

Previously, Finance Minister Bambang Brodjonegoro said there were about 2,000 foreign investors who had avoided their tax liabilities in the last 10 years by declaring losses or changing names to get new tax allowances. The practices led to Rp 500 trillion (US$38 billion) in state losses.

By revoking principal permits, Franky said, all the following licenses would automatically expire. However, a company with a revoked permit could retain its assets under its name, but could not utilized them.

"They will have to sell the assets," he said, underlining that those 2,000 companies were on a list of foreign firms that committed the worst cases of tax avoidance.
Some milder cases were settled through mediation. "For these cases, we will help the foreign investors in mediation. We want them to continue operations," Franky said. (ags)

Source : www.thejakartapost.com  4 April 2016

Opinion

From the news above I found I quite agree and support the government's move to grow revenues nationals who come from tax revenues and provides for penalties to taxpayers , both individuals and entities that are not obedient taxes for the payment of taxes by the taxpayer was important to do in order to create Indonesia better , especially in the public interest such as the creation of a common service facilities more adequate .

As we have seen for the areas of the capital Jakarta alone almost 50 percent of its territory occupied by companies and agencies or foreign institution set up investment in Indonesia . however only a few companies who are obedient to the tax .

according to the finance minister in the past 10 years alone there are 2,000 foreign companies that do not pay taxes and therefore I support to revoke licenses from companies which do not comply with the tax in order thereafter corporate taxpayers were not negligent in paying taxes so that the state revenue derived of taxes will increase.

What big Indonesia's per capita income if any person or entity can comply with tax especially corporate tax which accounts for the highest fare is 25 percent of its net income . Indonesia will probably become the richest nation and advanced .

Solutions

1. The government established a special body to oversee taxes , especially for foreign companies that are in Indonesia
2. Calculate and Targeted revenue of the tax from each taxpayer both individuals and entities that are in Indonesia
3. Add the KPP ( tax office ) in each area so that every taxpayer can pay taxes more easily
4. Teach and apply online payment systems such as e - filing of tax for each employee (taxpayer) in Indonesia in order to monitor any future tax payments
5. Increase and improve e- filing system so that no more errors in the input tax payments