Indonesian govt to optimize tax receipts through database

Indonesian govt to optimize tax receipts through database

Minister Sri Mulyani Indrawati. (ANTARA)

The tax ratio, which is still 11 percent, is small, while we have the potential (to increase it)."
Jakarta (ANTARA News) - The optimization of tax revenues in 2017 and efforts to improve the tax ratio, which is still low, will be conducted through the use of a taxation database, according to Finance Minister Sri Mulyani Indrawati.

"We will see how large the countrys tax base actually is," the minister stated here on Monday.

Mulyani said projections related to the taxation database will be made to evaluate the potential of tax revenue that could actually be collected by the government by taking into account the economic conditions.

"If for an economic activity, with a gross domestic product (GDP) size of Rp13 thousand trillion, we need to know how much has been deducted from the non-taxable income and how many taxpayers have been given non-taxable facilities and unpaid value-added taxes, and non-finalized income taxes," the minister explained.

Mulyani has ensured the task will be carried out by a tax reform team, as the optimization of tax revenue can be conducted more effectively through the presence of an adequate taxation database.

"This is to be done by the tax reform team to check whether there are tax bases, activities, collected data, ability to collect taxes, and regulation constraints," she noted.

Hence, the finance minister has expressed hope that in the long term, the tax ratio, which is presently at 11 percent, would be improved, and tax revenue will no longer slip away from the target as it is today.

"The tax ratio, which is still 11 percent, is small, while we have the potential (to increase it). Now, what is the problem? Cant we see it or we have no ability to collect it? I would not say the target (taxes) is high or not, but the tax ratio can still be and must be corrected," she affirmed.

The government is targeting a tax revenue of Rp1,307.67 trillion in the 2017 Budget. Tax revenues in 2016 had reached Rp1,104.9 trillion, with contribution from the tax amnesty program reaching Rp107 trillion.
(Uu.A014/INE/KR-BSR)

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