BEWARE: there will be no place to hide for tax evader
The tax amnesty period that will end by 31st of March 2017 will trigger tax officials to hunt for recalcitrant taxpayers who continue to hide their assets, having declined to avail of the tax amnesty.
President Joko “Jokowi” Widodo’s administration will take advantage of an opportunity to scrap long-standing bank secrecy policies, which is expected to boost the tax reform program and increase the tax ratio, after adopting new global standards on the Automatic Exchange of Information (AEOI), which will be implemented in September 2018.
Endorsed by the Organization for Economic Cooperation and Development (OECD) and the G20, of which Indonesia is a member, the AEOI scheme binds its participants to automatically exchange taxpayer information, such as addresses, bank account details and asset purchases in other countries.
Some 101 jurisdictions have committed to implementing the AEOI standards, with 54 of them ready to implement them in 2017, including the United Kingdom, India, the British Virgin Islands and Cayman Islands, while the remaining 47 countries including Indonesia, Singapore and Hong Kong will implement them in 2018.
The AEOI implementation will be the next step in the country’s efforts to improve tax compliance when the tax amnesty ends on March 31. With more than Rp 4 quadrillion (US$300 billion) in declared assets from the tax amnesty, the country’s tax authorities will have an extra tool to verify taxpayer data when the time comes for openness in bank accounts.
"We declare that there is no place to hide to for tax evader. That should be the title of it. If you talk of equality then there is no place to hide for tax evader," said Sri Mulyani