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Govt to expand tax base; targets middle-class individual taxpayers

JAKARTA: Indonesia Vice President Boediono said the country's tax base is low and it still has plenty of rooms to boost tax revenue.State revenue optimization programs are urgent to escalate financing for programs related to the 2015 Millennium Development

JAKARTA: Indonesia Vice President Boediono said the country's tax base is low and it still has plenty of rooms to boost tax revenue.State revenue optimization programs are urgent to escalate financing for programs related to the 2015 Millennium Development Goal.Indonesia needs to generate more taxes. Our tax base is somehow modest, and there are other sectors that are potential (to be tapped for further tax collections), he said during yesterdays World Economic Forum.Boediono said the government's roles in achieving MDGs target are important. The government must actively take an active role in the economic, social, and environment development. Funding for these programs can come from the domestic sources.Separately, Director General of Taxation Fuad Rahmany is ready to expand the taxpayers' coverage as the country has depended too heavily on collecting taxes from the institutional taxpayers.He added that the IDR708 trillion tax collection target only relies on 500,000 institutional taxpayers. Ironically, such amount covers more than 90% of the total tax payment. The remaining contributors are individual taxpayers.In the future, we shall hold tax intensification and extension as we will also enlarge the tax portion for individual taxpayers, he said.The tax agency will go after the middle class, individual taxpayers, while the high class citizens have very much been well-covered, Fuad said.Getting police helpIn the meantime, with regards to tax receivables settlement, Directorate General of Taxation will partner with the law enforcement agencies to help resolve problems.Besides partnering with Police, Directorate General of Taxation will partner with Corruption Eradication Commission.Tax claims issue became a media spotlight after the Supreme Audit Agency (BPK) announced its recent auditing result of tax claims. The investigation found that Indonesia still has IDR70 trillion in tax claims.The amount of tax receivables will continue to change, depending on the expiration period of each receivable. The amount could have declined to IDR50 trillion, or risen, he said. (t02/msw)

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