Eddy Kusnadi Sariatmadja, the founder of media giant Emtek Group, was among dozens of wealthy taxpayers who received an award from the Finance Ministry’s Directorate General of Taxation on Tuesday for being compliant, an attitude seen as an example to be followed by his peers.

Eddy, who is also the president commissioner of his company, said friendly tax officers with good awareness of how to serve the people would help taxpayers be more responsive in meeting their tax obligations.

He said that in the past, business owners and managements tended to have a low level of trust toward tax officers, but discussions and a cooperative attitude shown by the latter over the years had changed the situation.

“That’s because tax officers [should] educate and consult businesses as well as help us, rather than taunt us with sanctions and threats,” he said on Tuesday.

The tax office last year took a hawkish approach to ensuring compliance as it faced a potential shortfall in tax collection, but in doing so has scared away businesses. Dozens of disobedient taxpayers, some of whom are foreign nationals, were taken into custody in 2017, known technically as gijzeling (the Dutch word for “hostage”).

Tax compliance remains low in Southeast Asia’s largest economy, with the tax to gross domestic product (GDP) ratio at less than 11 percent, still far below the internationally recognized 15 percent minimum threshold for stimulating economic growth.

With the leadership of the newly appointed tax chief Robert Pakpahan, it was expected that the tax office would improve its approach toward taxpayers, experts previously said.

Such a move might be seen through the event on Tuesday, when the Directorate General of Taxation’s Large Tax Offices (LTO) headquarters, which is responsible for managing accounts of big individual and institutional taxpayers, awarded tokens of appreciation to 31 people for being compliant.

Among the prominent individuals on Tuesday were founder of Medco Energi Arifin Panigoro, CEO of food giant Indofood Anthoni Salim and CEO of diversified conglomerate Lippo Group James T. Riady.

Meanwhile, 23 corporations received similar awards, including state-owned companies such as pawnshop Pegadaian, oil and gas giant Pertamina and electricity firm PLN, as well as private ones, namely Adaro Energy, Unilever Indonesia and Chandra Asri Petrochemical.

Businessman Sofjan Wanandi, who also received the award on Tuesday, said openness between businesses and the tax authority should be encouraged, as a higher level of trust would reduce potential disputes or misconceptions about the two parties.

Sofjan, who is an advisory board chairman of the Indonesian Employers Association (Apindo), said it was important for both parties to build good communications, while suggesting that the government always inform businesses about any new regulations.

The tax office’s LTOs booked tax revenue worth Rp 361.8 trillion (US$25.3 billion) as of 2017, equal to 27 percent of Indonesia’s total tax revenue of Rp 1.34 trillion.

For this year, the LTOs plan to collect Rp 432.3 trillion in tax revenue, or 30.33 percent of the Rp 1.42 quadrillion national goal.

“If you have excess funds, please don’t just put them in securities or abroad. Invest them as taxes in Indonesia and we will give you [fiscal] incentives,” Finance Minister Sri Mulyani Indrawati said in her speech at Tuesday’s event, adding that the government was drafting revised regulations for the incentives.

The prepared fiscal incentives include tax holiday simplification as well as tax deductions for companies which provide research, development and vocational training. (ami)

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