By the second week of August, the government received some IDR 625.1 billion from tax amnesty participants. This is quite a significant increase on July’s figure of IDR 85.1 billion.
Participants of the tax amnesty program include non-micro, small and medium enterprises (MSME), which contributed a total of IDR 112.7 billion; MSMEs, which contributed IDR 2.14 billion; individuals of MSMEs, who contributed IDR 39.7 billion; and non-MSME individuals, who contributed the most, at IDR 470.5 billion. (Read: BI: Tax Amnesty to Drive Economic Growth to 5.3 Percent).
Payments made by individual non-MSME taxpayers increased by IDR 400 billion in August from only IDR 70 billion in July. Payments from non-MSME companies amounted to IDR 99.9 billion this month, which was more than July’s IDR 12.8 billion.
Meanwhile, the government has received a total of IDR 1.14 trillion in repatriated funds, which are declared overseas net assets that will be returned to Indonesia. In July, taxpayers declared a total of IDR 579 billion and IDR 560.9 billion in overseas net assets this month to be repatriated to the nation. So far, taxpayers have declared they own overseas net assets amounting to IDR 3.66 trillion, IDR 643.4 billion of which was declared in July and IDR 3 trillion declared this month.
“Meanwhile, IDR 25.9 trillion of domestic net assets have been declared. IDR 2.5 trillion in June and IDR 23.2 trillion in August,” said the tax amnesty monitoring dashboard on Thursday (18/8). (Read: Repatriated Funds Amount to IDR 458 Billion Two Weeks Into Tax Amnesty Program).
Finance Minister Sri Mulyani said she will monitor the movements of funds coming in from the tax amnesty program, especially from now until September. If the government receives much less than the targeted IDR 165 trillion, the minister will launch concrete policies to anticipate fiscal risks because the gap between the nation’s tax revenue target and actual tax revenue outside the tax amnesty program is estimated to reach IDR 219 trillion. Sri emphasised that the policies she might launch would not have an impact on economic growth or market trust. (Read: Jokowi Approves of Sri Mulyani’s Proposal due to Unrealistic Tax Target).
“We continue to put our hopes on the tax amnesty program, especially until September. Then I can make an assessment. If there are any fundamental structural obstacles that cause us to revise our target, we will introduce a fundamental policy,” Sri Mulyani said on Wednesday (17/8).
As previously reported, the tax amnesty program will be divided into three quarterly periods. This first period will be from July-September 2016, the second from October- December 2016, and the third from January-March 2017. (Read: Sri Mulyani Gathers Inputs, Revises Tax Technical Regulations for Tax Amnesty).
Taxpayers who are willing to repatriate their overseas assets will only have to pay a penalty of two percent during the first period. Those who repatriate their funds during the second period and the third period will be subject to a penalty of three percent and five percent, respectively. Meanwhile, those who only choose to declare their overseas assets without repatriating their funds would be charged a penalty that double that of those who opt to repatriate their funds, which would be four percent during the first period, six percent during the second period and 10 percent during the third period.
A lower penalty applies to MSMEs. MSMEs that declare assets worth IDR 10 billion would only be charged a penalty of 0.5 percent, while those that declare assets worth over IDR 10 billion would be charged a penalty of two percent.