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Jakarta Post

The taxman's new strategy

  • Ricky Pratomo
    Ricky Pratomo

    Legal analyst in an Indonesian legal media company

Jakarta   /   Wed, July 19, 2017   /  10:55 am
The taxman's new strategy No matter how perfect the tax enforcement system, it will all be meaningless without voluntary compliance by the public. (Shutterstock/File)

Subsequent to the end of Indonesia’s bittersweet tax amnesty on March 31, everyone keeps asking “What is the next strategy for tax enforcement?” Realizing that the tax amnesty was unsuccessful in repatriating assets, Finance Minister Sri Mulyani Indrawati has come up with a whole list of brand new mechanisms, for instance: 1) the Automatic Exchange of Information for tax purposes (AEOI); 2) Domestic disclosure of financial information (domestic disclosure); and 3) Prevention of Base Erosion and Profit Shifting (BEPS). These measures are certainly groundbreaking and sophisticated and one may assume that they are bold moves in Indonesia’s tax enforcement regime. However, the ultimate question lies in whether these measures will be effective in collecting taxes. Disclosing financial information: It is crystal-clear that disclosing financial information will ...

Disclaimer: The opinions expressed in this article are those of the author and do not reflect the official stance of The Jakarta Post.