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Jakarta Post

RI needs broad-based tax reform to boost revenue: IMF

  • Adrian Wail Akhlas


Jakarta   /   Sat, October 24 2020   /  01:00 am
The officer shows an online display on which can be used by taxpayers to fill out the Annual Tax Returns reporting form online at the Directorate General of Taxes, Sudirman Building, Jakarta, Wednesday (11/3/2020). The Directorate General of Tax of the Ministry of Finance reminded the reporting limits for personal taxpayers until March 31, 2020 while for business taxpayers until April 30, 2020. -JP / Dhoni Setiawan / Adi / 20(JP/Dhoni Setiawan)

Indonesia needs broad-based tax reform to boost its revenue in the long run so that the country can minimize the impact of spending adjustments and fund its development projects, the International Monetary Fund (IMF) has said. Although the country has established a digital tax as a new income source, the additional revenue is likely to be limited during the next few years because digital transactions remain small, said IMF mission chief for Indonesia Thomas Helbling. “It is unlikely to offset the loss in corporate income tax from the reduction in tax rates,” he told The Jakarta Post on Wednesday. The government has cut corporate income tax from 25 percent to 22 percent this year and will cut it further to 20 percent in 2022. The cuts apply to almost all business sectors and are part of an effort to keep the private sector afloat during the pandemic. Read also: Exc...