The recently passed Harmonized Tax Law (UU HPP) includes an international tax policy regarding global tax collection assistance that allow other countries to help collect taxes from Indonesian taxpayers, Indonesian Minister of Finance Sri Mulyani said.
“We can ask other countries to help collect taxes if we know that there are our taxpayers or other countries can also ask us to help collect taxes if they are in Indonesia,” the Minister said in a kickoff event for the dissemination of information on the harmonized tax law, Friday (19/11).
According to the Minister, this step was taken to revive the economy and gradually restore the State Budget from the impacts of the COVID-19 pandemic.
“All countries are hunting for taxes because we have been affected by COVID-19. They have a very high deficit. They have to restore their State Budgets too. So many countries are now working together to jointly eliminate tax evasion or tax avoidance,” she added.
The Minister also said that the Government has the authority to carry out global taxation consensus to form and/or implement agreements in the field of taxation with the governments of partner countries or partner jurisdictions, bilaterally or multilaterally. This is implemented to avoid double taxation and prevent tax evasion, to prevent base erosion and profit shifting, to exchange tax information, to help collect taxes, and others.
“This is being done at the global level because all countries now agree that we should not take each other’s tax rights,” the Minister remarked. (PR of Ministry of Finance/UN) (FI/EP)