State to trace and tax assets kept hidden during amnesty
JAKARTA: Indonesia’s government has issued new regulations aimed at tracing and taxing the wealth of taxpayers who were not pardoned in the nine-month tax amnesty that ended in March.
Around 972,000 taxpayers joined the amnesty programme and declared assets worth a total of 4,881 trillion rupiah (12.1 trillion baht). About 24% of that was held offshore, mostly in Singapore, and only a small percentage of it was pledged to be brought back home.
President Joko Widodo vowed last year to implement a “tax law enforcement” programme in 2017 following the amnesty. His finance minister, Sri Mulyani Indrawati, warned tax dodgers that if they did not join the amnesty, they would face “hell”.
But the government later acknowledged that tax amnesty declarations and the pledged repatriation of offshore assets back to Indonesia did not correspond to data it had on taxpayers’ foreign holdings.
In a guide to the new regulations, the government said it had also detected onshore assets that were not reported under the amnesty and had not been obtained with taxed income.
“Given that condition, after the tax amnesty programme ended it must be followed by law enforcement in the taxation field,” it said.
The regulation calls for all assets that were not reported or were misreported in the amnesty programme to be treated as untaxed income.