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Jakarta Post

[INSIGHT] Tax digitalization needed to aid pandemic relief, boost recovery

  • Suahasil Nazara and Jay Rosengard

    Jakarta/Boston, Massachusetts

Jakarta/Boston, Massachusetts   /   Thu, February 11 2021   /  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, on March 11, 2020.(JP/Dhoni Setiawan)

Tax system digitalization will provide a potent second shot in the arm to accompany recent COVID-19 vaccine breakthroughs as Indonesia strives to provide relief from the pandemic’s devastating impact and pursue post-pandemic recovery and growth. Digitalization is not the ultimate objective. Instead, it is a tool to enable the Directorate General of Taxation (DGT) to fulfill its mission better. A report by the United Nations-based Better Than Cash Alliance finds that digitalization of tax systems in emerging markets, when coupled with complementary administrative reforms, can raise annually an additional US$300 billion worldwide. This can help close much of the fiscal gap that threatens achievement of both the UN’s Sustainable Development Goals and Indonesia’s vision to become a high-income nation by 2045. The government has been extremely proactive in respon...