2016: Tax Amnesty Year

Year 2016 has been expected to be the tax amnesty year, as follow up of 2015 as tax education year). Commonly tax amnesty is defined as the elimination of tax base, administrative sanctions and or tax punishment on non-compliance of tax payment in the past. Tax amnesty program generally takes place within a period of two months until to a year. Indonesia taxation history recorded the tax amnesty program already executed, with a variety of common term in practice such as remission, amnesty and sunset policy. At least Indonesia has applied four times of the similar program which in 1964, 1984, 2008 (Sunset Policy) and 2015 (Reinventing Policy).


Indonesia government is almost certain to apply Tax Amnesty in 2016. The general purpose of national tax amnesty is to increase tax revenue of the current year, improve tax compliance in the future, capital repatriation, transition to the new taxation system and national reconciliation. The successful of tax amnesty program is measured by the level of achievement of those purposes.

In this amnesty program, Indonesia government should learn the history of tax amnesty policies in South Africa. It could inspire Indonesia that if the taxpayers whose assets saved in overseas propose tax amnesty and accepted by tax authority, and then the tax rate will be charged 50% lower if they transfer and save the assets back to the origin country, rather than still keep it abroad.


Nowadays, most of taxpayers are waiting for tax amnesty policy to be applied in Indonesia. Until now, the government still not yet decided the term of policies. Current temporary discussion about tax rates are 2% for tax amnesty proposal in the first 3 months, 4% for the proposal in second 3 months, and 6% for the second semester of tax amnesty year. The tax rate will be charged to the difference between the net asset values to be proposed for tax amnesty and net assets that already reported in Income Tax Return (SPT) at year 2014.


Taxpayers, who have not filed their overall assets whether placed in domestic or overseas, absolutely should participate on the national tax amnesty program to take its benefits. Please consider that after tax amnesty year end, the government has planned to set law enforcement year, tax law amendment, and acquisition of bank account data by implementing Automatic Eol system which allows Indonesia Tax Authority obtains the bank accounts information of taxpayers.


Reporting all assets into tax filing also will help taxpayer children and heirs in their own tax reporting in the future. Be prepared to greet the tax amnesty policy, maximize the opportunity to get the lowest tax rate in the early months of its implementation.


Upon this article prepared, Indonesia government and legislators still prepare the tax amnesty program in term of detail, and not yet made any final decision, so we still cannot conclude anything about any terms, procedures, or period about this program. If you have any questions about tax issues in your institution, please get in touch with our tax specialists at info@winnindo.com.