ICW unveils unrecorded taxes of Rp 21.3t from subsidized fuel sales

Alfian ,  The Jakarta Post ,  Jakarta   |  Fri, 11/21/2008 8:48 AM  |  Headlines

Indonesia Corruption Watch (ICW) on Thursday unveiled findings of alleged state losses of Rp 21.32 trillion (US$1.7 billion) from unrecorded tax revenue from sales of subsidized fuels
by state oil and gas company Pertamina.

Firdaus Ilyas, coordinator of the ICW’s data and analysis center, said the recorded tax revenue from sales of subsidized fuels between 2006 and 2007 was far lower than it should have been.
Firdaus said audits from the Supreme Audit Agency (BPK) for the 2006-2007 fiscal year found total tax revenue from subsidized fuel sales in that period was only Rp 107.25 billion, while, according to the ICW, total revenue should have been Rp 21.43 trillion.

“We have lost Rp 21.32 trillion in state revenue during that period,” Firdaus told a press conference.

The government subsidizes four types of fuel: Premium gasoline, diesel, kerosene, and three-kilogram-canister LPG.

The ICW said retail prices of the fuels included a 10 percent value-added tax, and for Premium gasoline and diesel, a 5 percent vehicle fuels tax, which the government should have included in tax revenue.

Firdaus added the alleged state loss of Rp 21.32 trillion came from these taxes
not being calculated in the revenue.

“There are two possibilities here: First, PT Pertamina did not pay the taxes. Or second, the tax offices allocated the revenues to another post — which is also wrong due to our state accounting system,” he said.

Pertamina, the sole distributor of the subsidized fuels, rebuffed the ICW’s claims and said it had paid all the relevant taxes.

“I don’t know about the ICW’s findings, but our finance department always pays the taxes on the 15th of each month,” said Perta-mina spokesperson Anang Rizkani Noor.

Firdaus urged the BPK to re-audit the state revenue from subsidized fuels, warning more state losses could occur if left unchecked.

“Potential state losses from the subsidized fuel tax this year could reach Rp 24.32 trillion,” he said.

An earlier BPK audit found several irregularities in subsidized fuel management.

On July 28, the agency sent a letter to the National Police requesting that they conduct further investigations into alleged wrongdoings surrounding the missing revenue from 4.59 million liters of fuel in excess of the subsidized fuel quota in 2007.

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