Update COVID-19 in Indonesia: 497,668 confirmed infections, 15,884 deaths (23 November 2020)
23 November 2020 (closed)
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The government of Indonesia is in the final phase of revising its tax collection target of 2016 from IDR 1,360.2 trillion (approx. USD $98.5 billion) to IDR 1,226.9 trillion (approx. USD $89 billion). Indonesian Finance Minister Bambang Brodjonegoro said the new 2016 tax target is based on a 10 percent year-on-year (y/y) growth of last year's tax realization plus an estimated IDR 60 trillion (approx. USD $4.3 billion) generated through the government's planned tax amnesty bill.
In 2015 the government of Indonesia collected IDR 1,060.9 trillion in tax revenue, or only 82 percent of the target set in the 2015 State Budget. A positive development, however, is that government tax revenue generated through the incentive offered to those companies that revalue their fixed assets (part of the government's fifth economic stimulus package) was two times higher than the target. When a company decided to revalue its fixed assets before the start of 2016 then the tax that needs to be paid on the company's fixed asset growth was cut from 10 percent to 3 percent. Through this tax incentive the government earned an additional IDR 20.1 trillion (approx. USD $1.5 billion) in 2015.
In 2016 tax collection is targeted to grow on the back of the country's accelerated economic growth (which implies that businesses will engage in more business transactions) as well as on people's improved purchasing power (implying they will consume more products and services). This year the economy is expected to expand 5.3 percent (y/y), compared to an estimated 4.7 percent (y/y) in 2015.
The government is also optimistic that a planned tax amnesty bill will raise an additional IDR 60 trillion in 2016. This controversial bill protects those who have parked their assets abroad (it is estimated that around IDR 3,000 trillion or approximately USD $221 billion in funds is secretly stored overseas). Taxpayers who report their overseas wealth will be taxed between 1.5 and 6 percent if they disclose their wealth in 2016 (the program finishes at the end of 2016). Currently, Indonesia's personal income tax ranges between 5 and 30 percent, while corporate tax ranges between 20 and 25 percent. Through this bill the government aims to widen the tax base. However, many have criticized the bill as it basically 'rewards' corrupters.
Tax Revenue Indonesia in 2015:
|Tax Oil & Gas||49.7|
|Tax non - Oil & Gas||1,011.1|
|Tax Revenue Realization||1,060|
|State Budget Target||1,294.2|
Source: Indonesian Finance Ministry
Do you agree with the government's plan to grant amnesty to tax evaders?
Voting possible: -
- Yes (50.8%)
- I don't know (30.8%)
- No (18.5%)
Total amount of votes: 65