Jakarta (ANTARA) - The core tax administration system (CTAS) update can help increase Indonesia's tax ratio by 1.5 percent to gross domestic product (GDP), according to Finance Minister Sri Mulyani Indrawati.

"We are trying to increase the tax-to-GDP ratio by 1.5 percent through this updated system," he said.

She added that CTAS will increase automation and digitalization of all tax administrative services. It allows for tax self-reports and automatic filing of annual tax returns, improving transparency.

While President Joko Widodo has not set a target for a tax-to-GDP ratio increase through CTAS, she emphasized that Indonesia is one of the ASEAN member countries that needs to increase its tax ratio.

According to Indrawati, some studies found that the tax ratio can also be increased by 3.5 percent to GDP through regulatory and policy improvements.

"So, the potential increase can reach 5 percent to GDP," she said.

Currently, Indonesia's tax ratio is only around 10 percent in the last 10 years, lower than the Asia Pacific average of 19.3 percent.

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Translator: Mentari G, Kenzu
Editor: Anton Santoso
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