Wednesday, October 10, 2007

INDONESIA IS TAXING

There were only 1.3 million income tax returns filed last year in Indonesia! Can that be right? Out of 220 Million people? I thought unemployment according to the government was only 10% (suree...). There would be more than 1.3 million public servants alone in Indonesia.

Check out this from the Jakarta Post of 9 Oct 07:

"Darmin now manages at least 10 million registered individual income-tax payers, of which almost seven million were netted under a massive campaign in 2005.

However, Darmin put the number of registered income-tax payers last week at a mere four million. Even more disappointing is only 33 percent or 1.32 million of them filed their annual tax returns -- the other 2.68 million were classified as non-filers."

Besides the obvious fuzzy maths, how the hell does this work?

On the plus side, the non filing of tax returns should make it easy to collect those missing funds from the old regime (and sections of the current?) and their families. Just check the tax returns, if its not declared they have admitted its not their money/assets, so the poor people can have a win for once, no lengthy court battles just take it.

For an expat is is extremely difficult to avoid paying tax and most accept Tax is necessary (unpleasant but necessary) part of maintaining any sort of just society. The concept that the country owes someone a living is as dead as Port Power's Pride after the grand final.

Why do I mention expats? Well in view of only 1.3 Million people contributing to the coffers of the country, maybe the next time that inane xenophobic "us vs them" "you are only a guest" bullsh*t arises. Perhaps the response should be "as least I am a paying Guest and you are a ....... on the country"

Facts are if you can afford a computer then you should be filing a tax return, if not chances well...it needs no further explanation without getting nasty.

Here's a thought, how about anyone who buys a new car must produce a tax file number..that'll get em!

HAVE FUN

P.S. Wouldn't it be cool of every elected official had his tax return published by the Tax Department and just how much tax did the Fabulous Baker (ie) Boys pay last year?

5 comments:

johnorford said...

i think the practice of not having income taxes in indonesia is a good one - taxing income is absurd, taxing pollution or consumption is a better idea.

the problem is the taxes are still on the statute books, which leaves the tax authorities carte blanche in terms of extortion etc.

interestingly in indonesia, the tax dept is legally untouchable by outside anti-corruption bodies (afaik) i wonder why that is?

Indonesia Anonymus said...

You wrote:
For an expat is is extremely difficult to avoid paying tax...

Dude, not just expat. We, lowly local employees can't avoid paying tax either. Even before we receive our pay, the tax is already deducted. All we got is a receipt from the tax office.

If the numbers are very low, there are 2 possibilities:
One, as you mentioned, people avoided paying.
But there is number 2:
People actually pay, but not all payments received are reported.

Knowing Indonesia, which one is it that you think is more likely?

Just a thought.

oigal said...

Johno,

You make a very good point, a consumption tax has a lot of merit although not sure how it would work in Indonesia, something more expensive in Indonesia than Malaysia or Viet then you have to have a lot of faith in Customs?

IA,

Yep, you are right as well, post was written from an expat point of view. I just find the figure unbelievable particularly as you say the "little people" are their wage garnished before they get it..mmm some fuzzy maths going on here.

Achmad (Assmad) Infantile comments about beer and 16 year old girls along with other those other bodily function jokes most of us grew out of when we left prep school may still be amusing to you but not to adults. Please see comment in previous post..but thanks for wasting more of your time))

Achmad Sudarsono said...

Oigal,

Cheap tactics to avoid the truth: censorship.

Friend: the Singaporean government does the same thing.

Friend: I call on you to wake up.

oigal said...

Assmad,

Don't confuse censorship with qaulity control