The Directorate General of Taxation on Tuesday signed an Memorandum of Understanding (MoU) with the National Police, in efforts to speed up the handling of tax evasion cases.
The MoU, a revision of a similar agreement signed in January 2004, allows police to place six crime investigators at the headquarters of the Taxation Directorate General in Jakarta, National Police criminal investigations chief Comr. Gen. Ito Sumardi said.
“If scams, embezzlement or money laundering occurs we will work directly with the [directorate general]. We have chosen six investigators to work at the directorate so that things can happen more quickly,” he said.
Ito said the police would later place more investigators at tax offices nationwide.
Taxation Director General M. Tjiptardjo said tax investigators were supervised by police crime investigators.
“Tax investigators do not have authority to arrest [tax evaders]. We can ask for help [from police] to make arrests,” he said.
In early February, President Susilo Bambang Yudhoyono said the police should work harder to investigate businesspeople who had neglected to pay taxes.
Yudhoyono said tax evaders harmed the economy, since tax revenue accounted for up to 70 percent of the total state revenue.
The directorate is currently investigating a possible tax evasion case worth Rp 2.1 trillion involving three Bakrie Group companies — PT Kaltim Prima Coal (which allegedly owes up to Rp 1.5 trillion), PT Arutmin Indonesia (Rp 376 billion) and PT Bumi Resources Tbk (Rp 300 billion).
Politicians said Yudhoyono’s statement might have been directed at Aburizal Bakrie, whose party had differed from his own Democratic Party in a legislative inquiry into the Bank Century bailout.
The Indonesian Chamber of Commerce and Industry (Kadin) has said it hopes tax issues will not be politicized as they could harm the business climate in Indonesia.
The taxation directorate has also sent to the House of Representatives the names of taxpayers who were late in paying taxes — a list which would later be submitted to the media and the public.
“We don’t want tax to become a political tool. Don’t let [taxes] become instruments [used to lobby certain groups] because of the publication of this information,” said Hariyadi Sukamdani, Kadin’s vice chairman.
The publication of information on tax evasion could undermine the credibility of businesses, whose names should be protected by the taxation directorate, he said.
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