In recent years Indonesia has been shocked by the Tax Amnesty program, which was driven by the Directorate General of Taxes. Many people who are still uncertain, must or do not report the assets that have been hidden. In this article we will provide information especially for those of you who are still hesitant to declare their property to the Government. Keep in mind that Bill Sikes does not provide services regarding tax declarations and tax amnesty programs, but we will help provide a big picture of the program. Check out more about tax amnesty and its benefits here.
Definition of Tax Amnesty
According to the definition displayed on the official website of the Directorate General of Taxes, tax amnesty is a forgiveness program provided by the Government to Taxpayers including the elimination of taxes that should be owed, elimination of tax administration sanctions, and the elimination of criminal sanctions in the field of taxation on assets acquired in 2015 and earlier which has not been reported in the SPT, by paying off all tax arrears owned and paying ransom.
Of course this program is an opportunity for those of you who have not declared their property to the Government. Not only that, for those who have kept assets in other countries, so that they are not subject to high taxes, the tax amnesty is also the right opportunity to confess. This program is valid for several periods, each period also has different waivers. Therefore, the faster you declare property, the lighter the tax amnesty you get.
Unlike the UMKM taxpayers, for a property declaration of up to 10 billion, it will be charged 0.5%, while for property declarations of more than 10 billion will be charged 2%.
Tax Amnesty is a Golden Opportunity for You
This program is arguably the golden opportunity obtained by taxpayers in Indonesia. According to the Finance Minister, Bambang Brodjonegoro, said that besides being not going to be subject to criminal & administrative sanctions, an Indonesian citizen who reports his property is also involved in the country’s development. All ransom paid will be included in the APBN. If the state budget is more sustainable, then the opportunity for the Government to use the money in building infrastructure and improving people’s welfare is also greater.
Keep in mind that you are actually not required to join this program, this is only a matter of rights. The Director General of Taxation, Ken Dwijugiasteadi, emphasized that retirees, fishermen, farmers, and other tax subjects who pocketed salaries under Non-Taxable Income (PTKP) were allowed not to join the program. The PTKP limit is with an income of IDR 4.5 million / month or IDR 54 million / year.
In addition, Indonesian citizens who do not reside in Indonesia for more than 183 days within 12 months and do not have income from Indonesia are also entitled to not participate in this program. The choice that can be made is to correct the Annual Income Tax Return (PPT).
What if you are not included in both groups and still choose not to join this program?
If someone still does not submit a Statement (report) until the program period ends, then they must remain open for review, and are willing to be sanctioned if assets are not disclosed to the tax office. As stipulated in Law No. 11 of 2016 concerning Tax Amnesty, article 18 paragraph 1 and 2, it is written that if data or information is found regarding assets that have not been reported ( January 1, 1985 – December 31, 2015), the assets are considered as additional income received.
Furthermore, the assets found must be paid and subject to PPh or income tax (10-30%) according to the provisions. In addition, there will be additional administrative sanctions in the form of an increase of 200% of income tax that is not / less paid.
Example of Tax Amnesty Calculation
The following is a calculation example, in the following table shows the assets owned by Budi, all assets and debts are within the territory of Indonesia. The table below shows the difference in reports on the latest PPh SPT in 2015, and the assets that Budi finally recognized honestly in the program planned to be reported in November 2016. How much is the ransom Budi has to pay?
|Reported in the 2015 Income Tax Return (Last SPT)||Assets that have not been reported|
|Property Value||10 billion||15 billion|
|Debt Value||3 billion||5 billion|
|Net Asset Value (property value – debt value)||7 billion||10 billion|
The basis for the ransom (difference between unreported assets – assets that have been reported): 10 billion – 7 billion = 3 billion; from the difference, we can only calculate the cash paid. In accordance with Government regulations, November 2016 has entered period II so that domestic declarations will be subject to 3%.
So, the ransom paid is 3% x 3 billion = 90 million
Benefits of Paying Taxes
- Yustinus Prastowo, Executive Director of the Center for Indonesia Taxation Analysis, said that the benefits of taking part in the program are the right to get the tax elimination facility owed and sanctions, and get guarantees not to be examined and not investigated until 2015.
- You can save more money honestly with the Government. This is considering administrative sanctions that will be imposed if other assets are found, an increase of 200% can have a huge impact on your financial flow.
- If you are involved in this program, not only does it benefit from the amount of funds that can be saved, but you also contribute to the country’s development
So, this program is a good opportunity right? If you still haven’t reported, you still have the opportunity until the end of March 2017. Take advantage of this opportunity to save funds and cut more expenses. For more information about the tax amnesty program , you can get it on the official website or call the service number at 1 500 745.
Attention: Bill Sikes cannot provide services regarding this program. If you need a more expert figure, you should contact the nearest tax consultant so that you can better understand the amount of tax that you still have to declare. This article only aims to provide an overview of this program that we summarize through the official website of the Directorate General of Taxes and other supporting references that we deem reliable; Bill Sikes is not responsible for the truth of the information obtained in any form.