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New rule could give banks more headaches
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Vice President Jusuf Kalla (second from left) talks to Indonesian Employers Association (Apindo) chairman Hariyadi Sukamdani (left) and National Development Planning Minister Bambang Brodjonegoro (center) during a tax amnesty campaign last year. Indonesian Chamber of Commerce and Industry chairman Rosan P. Roeslani (right) and Apindo advisory board chairman Sofjan Wanandi (second from right) also attended the event. (Antara Foto/Rosa Panggabean)
F
ollowing the recent issuance of a regulation in lieu of law (Perppu) that allows tax officers to access and scrutinize banking data, domestic lenders are concerned about whether such a policy could increase costs and paperwork for their side.
Issued earlier this month, Perppu No. 1/2017 on financial information access for taxation purposes gives full freedom to tax officers to directly access bank accounts owned by both Indonesian citizens and foreigners.
The regulation paves the way to put an end to banking secrecy in the country, a necessary development for the implementation of the Automatic Exchange of Information (AEOI), a global initiative to fight tax avoidance practices.
By adopting AEOI standards, endorsed by the Organization for Economic Cooperation and Development (OECD) and the G-20, of which Indonesia is a member, the government will be able to trace assets held by Indonesians overseas through data provided by tax authorities in other countries and jurisdictions that impose the same measures.
This means Indonesia will also be required to provide the financial data of foreign customers in domestic banks and financial institutions to tax authorities of the origin countries or jurisdictions of the customers.
Bankers, however, expect the authorities to engage them in intensive discussions to clarify technicalities related to the implementation of the AEOI, National Banks Association (Perbanas) deputy secretary-general Anika Faisal said.
“We still have homework to do to clarify many things, such as the CRS [common reporting standard rule] with the OJK [Financial Services Authority],” she said in a discussion on Friday.
