The Socialization Program of Indonesian Tax Amnesty for IPB

In order to succeed the tax amnesty program launched by the government, the Directorate General of Taxation (DGT) of the Ministry of Finance of the Republic of Indonesia through the Tax Services Office (KPP) Pratama, Ciawi, organized “Socialization Tax Amnesty Program” at Bogor Agricultural University, on Tuesday, 16 August 2016. The event took place at the Auditorium of Andi Hakim Nasution, IPB Campus, Dramaga, Bogor. Special guests attended the special event among others were the Vice Rector for Research and Cooperation of IPB, Prof. Dr. Anas Miftah Fauzi, Secretary of the Institute (SI) of IPB, Dr. Ibnul Qayim, Head of West Java DJP III, Mr. Mohammad Isnaeni, and Head of Finance of IPB, Mr. Agus Cahyana, SE, MM, AK.

Dr. Ibnul Qayim said that a tax amnesty is a breakthrough program of the government to grow the economy in the country. He also mentioned about the adjustment of tax laws related to IPB’s new identity as a State Universities – Legal Entity (PTN BH), such educational institution is recognized in the tax laws.

Head of DJP III West Java, Mr. Mohammad Isnaeni, explained the tax amnesty is defined as the elimination of tax base, administrative sanctions and or tax punishment on non-compliance of tax payment in the past, or amnesty for taxation criminal offense. He expected that lower tax rate (between 2 – 5 percent) that will be imposed will be utilized by all taxpayers, they should be prepared to greet the tax amnesty policy, maximize the opportunity to get the lowest tax rate in the early months of its implementation.

Socialization of the tax amnesty was chaired by the head of the STO Ciawi, during which he discussed the rules stated in Law No. 11 2016 on tax amnesty and explained the Surat Pemberitahuan Tahunan (SPT Annual Tax Return), a tax amnesty petition, who can take advantage of the tax amnesty and how to calculate the tax rates to be paid.

A tax rate between 2 – 5 percent is imposed on repatriated assets within the July 2016 – March 2017 period. For those who declare their offshore funds before 30 September 2016 a 4 percent tax tariff applies. For those who declare their assets between 1 October and 31 December 2016, a 6 percent tax tariff applies. Lastly, for those who declare their assets between 1 January 2017 and 31 March 2017, a 10 percent tax tariff applies. For Indonesia’s small and medium sized enterprises lower rates apply (between 0.5 – 2 percent).

Tax amnesty will lure small medium enterprises (SMEs) into the tax system, the law offers a 0.5 or 2 percent redemption rate for SMEs, depending on business size. For example those with <10 billion assets they pay only 0.5%, whereas those with >10 billion assets they have to pay 2%. Please consider that after tax amnesty year end, the government has planned to set law enforcement year, tax law amendment, assets have not been disclosed will be considered as additional income, they are subjected to income tax and penalized 200%. (Wied)

Source: Bogor Agricultural University