Indonesia Can Now Request Tax Collection Assistance from 81 Countries

JAKARTA, DDTCNews - The number of countries that may provide assistance in the collection of taxes to Indonesia has risen significantly in line with the revision of Presidential Regulation 159/2014 concerning the Convention on Mutual Administrative Assistance in Tax Matters (MAAC) through Presidential Regulation 56/2024.

The Director of Tax Dissemination, Services, and Public Relations of the Directorate General of Taxes (DGT) Dwi Astuti said that on account of the issuance of Presidential Regulation 56/2024, Indonesia is currently able to request assistance in the collection of taxes based on the MAAC from 72 countries.

“As of May 15, 2024, 72 countries/jurisdictions may request and provide assistance in the collection of taxes based on the MAAC,” stated Dwi, quoted Thursday (5/16/2024).

Accumulated with the established tax treaties (Persetujuan Penghindaran Pajak Berganda/P3B in Indonesian), Indonesia may request assistance in the collection of taxes from 81 countries in total.

On another note, Presidential Regulation 159/2014 has been revised to allow MAAC-based reciprocal provision or request of assistance in the collection of taxes for or from treaty partners.

“That the Presidential Regulation 159/2014 ... has not accommodated the regulation of assistance in the collection of taxes based on international agreements on a reciprocal basis and has not regulated the withdrawal of the declaration made through notification, thereby, needs to be amended,” reads Presidential Regulation 56/2024.

Preceding the revision of Presidential Regulation 159/2014 through Presidential Regulation 56/2024, Indonesia was only able to provide or request assistance in the collection of taxes for or from 13 tax treaty partners, i.e., Algeria, the United States, Armenia, the Netherlands, Belgium, India, Laos, the Philippines, Egypt, Suriname, Jordan, Venezuela and Vietnam.

Referring to the declaration attached to Presidential Regulation 56/2024, the government declares that no assistance in the collection of taxes shall be provided for certain types of taxes. Included in such taxes are income tax imposed on behalf of political subdivisions or local governments, compulsory social security contributions, inheritance and gift taxes, specific taxes on certain goods and services, such as excise, motor vehicle tax, taxes on ownership of movable assets other than motor vehicles and other taxes.

Indonesia is, thus, committed to providing assistance in the collection of taxes for tax claims relating to income tax, capital gains tax, wealth tax, immovable asset tax and VAT.

The technical aspects of the provision of assistance in the collection of taxes, either based on the MAAC or others, are stipulated under the Minister of Finance Regulation (MoF Reg.) 61/2023.

MoF Reg. 61/2023, in general, stipulates assistance in the collection of taxes provided by Indonesia based on tax claims by tax treaty partners. Tax claims refer to legal instruments of tax treaty partners in connection with the request for assistance in the collection of taxes. (sap)