Indonesia is projected to again fall short of its tax revenue target next year as economic growth is expected to remain around a modest 5.6 percent.

Danny Darussalam Tax Center (DDTC) has projected that the country would manage to collect around Rp 1.21 quadrillion (US$99.49 billion) in tax revenue, or 94.5 percent of this year's target of Rp 1.28 quadrillion.

'Slow recovery of global international trade ' coupled with the current-account deficit, which will still be around 2 to 3 percent ' will affect our tax revenue,' DDTC researcher Bawono Kristiaji said during a seminar on tax and fiscal outlook on Saturday.

He added that around 40 percent of the country's value-added tax revenue came from import activities.

The country could increase its tax revenue next year in terms of percentage, but only slightly, he said.

The government failed to meet its tax revenue target by collecting only Rp 917 trillion, or 92.4 percent of the targeted Rp 995 trillion last year, according to data from the Finance Ministry's Tax Directorate General.

Bawono said that the rise in interest rates and the infrastructure bottleneck in the country would hinder significant growth of capital transaction and foreign direct investment, leading to the loss of potential tax revenue.

'In addition, low compliance of taxpayers will also hinder tax collection,' he said.

According to the Taxation Directorate General's data, only 41 percent of a total 24.8 million registered taxpayers submitted their income tax forms in 2012.

In 2011, 53 percent of 22.3 million registered taxpayers submitted their income tax forms.

The unclear boundaries between tax evasion and tax avoidance in the country were also one reason the government failed to hit its tax revenue target, with many tax cases left unresolved.

Tax evasion is defined as illegal non-payment or underpayment of tax, while tax avoidance is minimization of tax liability by taking advantage of loopholes in certain laws and regulations.

As of October last year, from a total 16,341 cases, only 5,630 were resolved, while the remaining 10,711 remained open.

Meanwhile, 9,515 of 16,068 tax cases remained unresolved in 2012, data from the Finance Ministry's Tax Court Secretariat shows.

Finance Ministry tax director general Fuad Rahmany said it was hard to only rely on a voluntary tax payment method.

'We also need personnel and more offices to supervise and force people to pay taxes,' he said during the same event.

There is only one tax officer for every 7,700 citizen in Indonesia, whose population is around 240 million, according to his office's data.

The ratio is much higher than in other countries such as Japan, whose figure is one to 1,818, Australia with one to 1,000 and Germany with one to 727.

He said the number of taxpayers increased to 24.8 million from 15.9 million between 2009 and 2012. However, headcounts at his office decreased to 31,316 from 31,825 during the same period.

He earlier said his office would never be able to catch up with the country's growing economy, unless it added more tax officers.

Fuad also said that his agency could not expand its tax coverage, leaving many semi-modern
retailers so far exempted from tax collection.

Indonesia has scored among the lowest in terms of tax revenue-to-gross domestic product (GDP) ratio, or tax ratio, within Southeast Asia.

It is estimated that the country's tax ratio hit only 11.77 percent last year, far below its neighbors Malaysia (15.31 percent), Thailand (17.07 percent) and Vietnam (24.26 percent). (koi)

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