Indonesian Tax News

Bank Indonesia Less Optimistic on Tax Amnesty Revenue

Jakarta. Bank Indonesia and the Finance Ministry have differing estimations of the amount of additional revenue from the tax amnesty program due to the difference in the data sources, the Bank Indonesia Governor revealed in a meeting with the House of Representatives on Monday (23/05).

Bank Indonesia, the country’s central bank, used illicit financial flow data from Global Financial Integrity which said Indonesians stashed Rp 3,147 trillion ($230 billion) in ill-gotten money abroad — from various crimes including corruption and tax invasion — in the 2004 to 2013 period.

“We estimate to add Rp 53.4 trillion [in tax revenue] based on the assumption that the tax amnesty program can be implemented from June to December with 2 percent tax for repatriated assets and 4 percent un-repatriated assets,” Bank Indonesia Governor Agus Martowardojo said.

Agus said Indonesians will repatriate at least Rp 560 trillion into the country, which will generate 0.3 percent more growth in the economy, 2 percent more growth in the loan disbursement and strengthen the rupiah against the US dollar by Rp 150 in 2016.

Meanwhile, the Finance Ministry has its own data accumulated since the 1970s — but only using data from the 1995 to 2015 period — Finance Minister Bambang Brodjonegoro said on the same occasion.

“We estimated that Indonesians currently have more than Indonesia’s 2015 GDP of Rp 11,400 trillion in unreported overseas assets,” Bambang said.

Bambang hopes that at least a part of those Indonesians will use the tax amnesty initiative and declare around Rp 3,500 trillion to Rp 4,000 trillion worth of assets and will bring will bring at least an additional Rp 160 trillion into 2016 tax revenue.

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