• Indonesian Tax Amnesty 2016

    By Ivan Kanel


    The Indonesian parliament formally approved the Tax Amnesty Law or Tax Forgiveness Act, on Tuesday, June 28, 2016.

    Through this law, taxpayers who have not reported the tax would receive a lower redemption rates. Rates are divided into three categories, namely for small and medium enterprises, for taxpayers who are willing to repatriate their assets abroad, as well as the declaration of assets abroad without repatriation.

    Polemics behind the discussion draft tax amnesty is 2015 economic targets by Indonesian government are not achieved.

    For taxpayers small and medium businesses that reveal a treasure to Rp10 billion will be charged a redemption rate of 0.5%, while that reveals more than Rp 10 billion, subject to 2%. Then, for taxpayers who are willing to repatriate their assets abroad will be granted a 2% redemption rate for July - September 2016, 3% for the period from October to December 2016 and 5% for the period January 1, 2017 until March 31, 2017.

    Finally, taxpayers who declare their assets abroad without repatriation will cost 4% for the period July-September 2016 6% for the period from October to December, 2016 and 10% for the period January-March 2017.

    Determination period is important because the Amnesty Act tax only applies until the end of March 2017.

    On various occasions, the Indonesian government said the tax amnesty policy is to increase state revenue from the tax sector. Until last August 2015, tax revenues reached around Rp 598 trillion or about 46% of the revised budget targets in 2015. By using the Amnesty Law on Taxes, state revenue is expected to grow to Rp165 trillion.

    On the other hand, some people worry about tax amnesty law could potentially be a facility "red carpet" for the conglomerate, perpetrators of economic crime, and the perpetrators of money laundering.

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  • The information provided in this article is for general information purposes only. The information is not intended to be comprehensive or to include advice on which you may rely. You should always consult a suitably qualified professional on any specific matter.

Ivan Kanel

Ivan Kanel, is based in Jakarta - Indonesia. Ivan is a member of Intercontinental Grouping of Accountants and Lawyers and IR Global since 2015. He has over 15 years of experience specializing in the international aspects of Indonesian Tax, Accounting and Auditing field. Ivan is member of the Tax Consultants Association, Accountant Association, Public Accountant Institute and Management Accountant Association in Indonesia. He has Public Accounting Firm, Accounting Services Firm, Tax Consulting Firm and Legal Firm in Jakarta. Ivan is also lecturer at Tarumanagara University and Trisakti School of Management in Jakarta. He is in charge of the following academic courses: Accountant, System, Taxation and Auditing. He has been quoted in the local and international research papers, scientific articles, and publications.

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