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Court verdict clears hurdles for Tax Amnesty Law
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Declare and relieve: President Joko "Jokowi" Widodo delivers a speech about the tax amnesty before 2,000 businessmen from the mining and plantation industries in Balikpapan, East Kalimantan, on Dec. 5. (JP/N. Adri)
T
he Constitutional Court (MK) rejected on Wednesday four judicial review petitions to challenge the legal basis for the 2016 Tax Amnesty Law.
The court, presided over by chief justice Arief Hidayat, ruled that Law No. 11/2016 on the tax amnesty did not violate the 1945 Constitution.
“The court rejects the request filed by the plaintiffs,” Arief read from the court’s ruling on the four judicial review requests in a hearing at the court building in Jakarta.
Arief said the ruling was based on the justices' in-depth review of the law after hearing legal opinions and views from experts provided by both the plaintiffs and government.
Four plaintiffs, namely Sugeng Teguh Santoso, the chairman of non-governmental organization One Justice Foundation and three labor unions represented by lawyer Eggi Sudjana, filed judicial review requests to challenge the law.
The plaintiffs argued that the law was unfair and discriminated against obedient taxpayers as it gave special privileges to tax evaders. They also argued that Article 20 of the law, which stipulates that data and information sourced from letters issued by the Finance Ministry or other parties related to the law cannot be used for the legal basis of investigation into or criminal prosecution of taxpayers, would create opportunities for money laundering.
To help plug the widening state budget deficit, the government is expecting to collect over Rp 165 trillion (US$12.5 billion) in penalty payments from its nine-month tax amnesty program, which kicked off in July.
Finance Minister Sri Mulyani Indrawati and the ministry's director general of taxation, Ken Dwijugiasteadi, were also present at Wednesday’s hearing, an indication of the government’s seriousness to quell opposition to the policy.
The Constitutional Court's verdict is final, and cannot be contested or appealed. (hwa)
