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Amnesty repatriated assets to have domino effect: IAI
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President Joko "Jokowi" Widodo speaks during an event related to the tax amnesty program in Medan, North Sumatra, on July 21. (Presidential Secretariat/Laily Rachev)
T
he Indonesia Accounting Association (IAI) projects that each quadrillion in repatriated assets through the tax amnesty program will result in Rp 4 quadrillion-worth of economic benefits for the country, leading to a higher tax ratio.
IAI chairman John Hutagaol said the government’s measures to provide a low redemption rate and pardon for the repatriated assets would boost liquidity, spurring economic growth amid the global economic slowdown.
"Each quadrillion in repatriated assets will have a domino effect of Rp 4 quadrillion, and increase our tax ratio from the current level at around 12 percent," he said in Jakarta on Friday.
The tax amnesty, he further said, was urgently needed as the global economy had yet to show recovery. China, the US, Japan and the EU are struggling with their economies, while global commodity prices remain low.
"Our purchasing power also remains low. Our economy grew below 5 percent in 2015. If this situation continues, our economy will be hit by the negative impact. That's why we need the liquidity," John added.
The government aims to see Rp 4 quadrillion (US$303 billion) in declared assets and Rp 1 quadrillion in repatriated assets from overseas, and to pocket Rp 165 trillion in tax revenues from the penalties. (ags)
