Tax
From The Report: Indonesia 2017
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This chapter examines Indonesia’s tax regime, focusing on a newly improved amnesty facility, income tax breaks available for pioneer industries, a new effort to improve data collection and processing, and the reduction of luxury goods tax for certain products.

It also contains a viewpoint from Ay-Tjhing Phan, Tax Leader, PwC Indonesia.

Articles from this Chapter

Overview

Paying your dues: A breakdown of regulations governing the tax system
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The Indonesian government has set a target tax-to-GDP ratio of 16% by 2019, up from the current average of 12-13%. While ambitious, the goal is not unattainable given that neighbouring countries Vietnam, Malaysia and Thailand have tax-to-GDP ratios averaging of 13% and 17%. However, the target can only be reached by widening and stabilising Indonesia’s narrow tax net. Facilitating Compliance An Indonesian citizen’s tax liability starts at birth and only ends when he or she permanently…

Viewpoint

One step ahead: Ay-Tjhing Phan, Tax Leader, PwC Indonesia, on balancing government and investor interests
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In order to finance Indonesia’s development, the government aims to achieve a 16% tax-to-GDP ratio by 2019. Armed with a five-year plan, the Directorate General of Taxation (DGT) faces a challenging, but not impossible, task in reaching this aspiration. Indonesia’s tax system is largely based on self-assessment, and despite the DGT’s efforts to widen the tax net, the current level of tax compliance is generally low. The DGT is thus conscious that further reforms are necessary if tax collections…