Indonesia

Type of profile
Country
Overview

Recent reform steps

Indonesia has taken the following major steps towards enhancing domestic revenue mobilisation:

  • Rolling out the Tax Amnesty Programme in 2016 to 2017 to expand tax base, enhancing the Director General of Taxation’s (DGT) data, improving tax compliance and developing a fresh relationship between taxpayers and the DGT;
  • Implementing a tax reform with five improvement pillars: introducing a new core tax system in IT and improving the data management system, improving the business process, human resources, restructuring organisation, and improving regulations, tax services development.

Progress achieved

Indonesia has implement several tax reforms since 2000. After the completion of the Tax Amnesty Programme in 2017, Indonesia launched its third tax reform, focusing on the following five main topics: organisation, human resources, information, technology and database, business process, and regulation.

In terms of taxpayers’ compliance management, Indonesia

  • Improved value added tax (VAT) compliance, which covers improvement in terms of registration, filling, payment and correct reporting;
  • Increased withholding tax compliance through filing automation and data matching between withholders and employees/taxpayers;
  • Enhanced service and administration of wealthy individuals (professionals, high earners and high wealth individual).

Moreover, institutional reforms

  • Improved the IT system through Core Tax System (CoTS);
  • Developed both internal and external data management through the establishment of a Data Management Unit (DMU);
  • Simplified the business processes for quality of service improvement.

Outlook: DRM priorities in 2019

Currently, Indonesia is enacting the outdated law (General Procedures, Income Tax and VAT Law) to catch up with the fast-growing business and digital environment. In addition, Indonesia emphasises institutional reform and leverages its resources to improve taxpayers’ compliance.

Priority activities
  • Build a system to map taxpayers’ compliance based on their risks (compliance risk management, CRM)

  • Improve service with online forms, easier refund, automation and data matching

  • Leverage third-party data as well as data gathered through Exchange of Information (EoI)

  • Improve IT and data management

  • Simplify business processes

  • Organise reform and human resources capacity enhancement

Expected outcomes
  • DGT will be able to focus its resources to collect revenue in an effective and efficient way
  • Taxpayers will be more comfortable with the tax authority, which will increase voluntary compliance in the near future
  • Mobilising revenue from prominent individuals as well as offshore accounts will become easier
  • State-of-the-art IT system and better data management to improve DGT’s capability on mobilising revenue
  • Better quality of service, agile organisation and world-class tax officers

Ensuring policy coherence for development

Indonesia is working towards policy coherence by implementing EoI, a joint programme with other institutions (customs, local governments, the Central Bank etc.) and new IT system/COTs (including CRM). Further, Indonesia is working on human resources improvement management programmes, which tackle remuneration, capacity building, improvement rotation and promotion systems. In terms of international organisations, Indonesia is engaging with the IMF, the World Bank and the OECD (MTRS, Inclusive Framework, capacity building, development programme loans, and other assistances).

DRM Project Data as Recipient

all
2015
2016
2017
Donor
year Year
No. project
amount Commitment
disbursement Disbursement
Canada
year all
5 projects
amount 2 018 741.15 USD
disbursement 1 236 154.34 USD
Extractive Sector for Sustainable Development / L'industrie extractive pour le développement durable
year 2015
1 project
amount 1 924 430.00 USD
disbursement 469 370.00 USD
Improved Personal and Corporate Tax Revenue Administration / Amélioration de l'administration fiscale des particuliers et des sociétés
year 2016
1 project
amount 94 311.15 USD
disbursement 0.00 USD
Extractive Sector for Sustainable Development / L'industrie extractive pour le développement durable
year 2016
1 project
amount 0.00 USD
disbursement 371 208.70 USD
Improved Personal and Corporate Tax Revenue Administration/Amélioration de l'administration fiscale des particuliers et des sociétés
year 2017
1 project
amount 0.00 USD
disbursement 16 560.16 USD
Natural Resources for Development Program/Programme de ressources naturelles pour le développement
year 2017
1 project
amount 0.00 USD
disbursement 379 015.48 USD
Germany
year all
10 projects
amount 1 531 924.72 USD
disbursement 2 251 228.08 USD
Assistance in preventing and combating corruption (KPK)
year 2015
1 project
amount 0.00 USD
disbursement 159 230.00 USD
Transforming Administration, Strengthening Innovation (TRANSFORMASI)
year 2015
1 project
amount 0.00 USD
disbursement 652 830.00 USD
Assistance in Preventing and Combating Corruption (KPK)
year 2015
1 project
amount 554 630.00 USD
disbursement 340.00 USD
Assistance in preventing and combating corruption (KPK)
year 2016
1 project
amount 7 920.79 USD
disbursement 14 924.40 USD
Transforming Administration, Strengthening Innovation (TRANSFORMASI)
year 2016
1 project
amount 0.00 USD
disbursement 610 425.30 USD
Assistance in Preventing and Combating Corruption (KPK)
year 2016
1 project
amount 0.00 USD
disbursement 118 869.80 USD
Transforming Administration - Strengthening Innovation
year 2016
1 project
amount 967 599.25 USD
disbursement 1 300.60 USD
Transforming administration - Strengthening innovation
year 2017
1 project
amount 0.00 USD
disbursement 373 904.51 USD
Assistance in Preventing and Combating Corruption (KPK)
year 2017
1 project
amount 0.00 USD
disbursement 289 171.71 USD
Transforming Administration, Strengthening Innovation (TRANSFORMASI)
year 2017
1 project
amount 1 774.68 USD
disbursement 30 231.76 USD
South Korea
year all
3 projects
amount 257 376.00 USD
disbursement 196 581.00 USD
Capacity Building of Tax Policy and Administration for the Revision of I
year 2015
1 project
amount 48 680.00 USD
disbursement 48 680.00 USD
Tax system and VAT administration (Indonesia)
year 2017
1 project
amount 140 870.00 USD
disbursement 85 380.00 USD
Master`s Degree Program in Finance and Tax Policy(17-19)
year 2017
1 project
amount 67 826.00 USD
disbursement 62 521.00 USD
Switzerland
year all
2 projects
amount 4 676 300.00 USD
disbursement 4 281 442.70 USD
ADB: Strenghtening Tax Revenue Administration at Central and Local Levels in Indonesia
year 2015
1 project
amount 4 676 300.00 USD
disbursement 1 870 520.00 USD
ADB: Strengthening Tax Revenue Administration at Central and Local Levels in Indonesia
year 2016
1 project
amount 0.00 USD
disbursement 2 410 922.70 USD
United Kingdom
year all
2 projects
amount -22 633.22 USD
disbursement 448 418.60 USD
Support to the Ministry of Finance on Low Carbon Investment
year 2015
1 project
amount 0.00 USD
disbursement 449 340.00 USD
Support to the Ministry of Finance on Low Carbon
year 2016
1 project
amount -22 633.22 USD
disbursement -921.40 USD
Australia
year all
2 projects
amount 173 202.09 USD
disbursement 173 202.10 USD
OECD Tax and Development Program for AEOI and BEPS
year 2016
1 project
amount 28 001.19 USD
disbursement 28 001.20 USD
Government Partnership Fund Phase (GPF) II
year 2017
1 project
amount 145 200.90 USD
disbursement 145 200.90 USD
France
year all
1 project
amount 110 582 771.20 USD
disbursement 110 582 771.20 USD
Reforme Fiscale Indonesie
year 2016
1 project
amount 110 582 771.20 USD
disbursement 110 582 771.20 USD
Totals
year all
25 projects
amount 119 217 681.94 USD
disbursement 119 169 798.02 USD
Donor
year Year
No. project
amount Commitment
disbursement Disbursement
Canada
year 2015
1 project
amount 1 924 430.00 USD
disbursement 469 370.00 USD
Extractive Sector for Sustainable Development / L'industrie extractive pour le développement durable
year 2015
1 project
amount 1 924 430.00 USD
disbursement 469 370.00 USD
Germany
year 2015
3 projects
amount 554 630.00 USD
disbursement 812 400.00 USD
Assistance in preventing and combating corruption (KPK)
year 2015
1 project
amount 0.00 USD
disbursement 159 230.00 USD
Transforming Administration, Strengthening Innovation (TRANSFORMASI)
year 2015
1 project
amount 0.00 USD
disbursement 652 830.00 USD
Assistance in Preventing and Combating Corruption (KPK)
year 2015
1 project
amount 554 630.00 USD
disbursement 340.00 USD
South Korea
year 2015
1 project
amount 48 680.00 USD
disbursement 48 680.00 USD
Capacity Building of Tax Policy and Administration for the Revision of I
year 2015
1 project
amount 48 680.00 USD
disbursement 48 680.00 USD
Switzerland
year 2015
1 project
amount 4 676 300.00 USD
disbursement 1 870 520.00 USD
ADB: Strenghtening Tax Revenue Administration at Central and Local Levels in Indonesia
year 2015
1 project
amount 4 676 300.00 USD
disbursement 1 870 520.00 USD
United Kingdom
year 2015
1 project
amount 0.00 USD
disbursement 449 340.00 USD
Support to the Ministry of Finance on Low Carbon Investment
year 2015
1 project
amount 0.00 USD
disbursement 449 340.00 USD
Totals
year 2015
7 projects
amount 7 204 040.00 USD
disbursement 3 650 310.00 USD
Donor
year Year
No. project
amount Commitment
disbursement Disbursement
Australia
year 2016
1 project
amount 28 001.19 USD
disbursement 28 001.20 USD
OECD Tax and Development Program for AEOI and BEPS
year 2016
1 project
amount 28 001.19 USD
disbursement 28 001.20 USD
Canada
year 2016
2 projects
amount 94 311.15 USD
disbursement 371 208.70 USD
Improved Personal and Corporate Tax Revenue Administration / Amélioration de l'administration fiscale des particuliers et des sociétés
year 2016
1 project
amount 94 311.15 USD
disbursement 0.00 USD
Extractive Sector for Sustainable Development / L'industrie extractive pour le développement durable
year 2016
1 project
amount 0.00 USD
disbursement 371 208.70 USD
France
year 2016
1 project
amount 110 582 771.20 USD
disbursement 110 582 771.20 USD
Reforme Fiscale Indonesie
year 2016
1 project
amount 110 582 771.20 USD
disbursement 110 582 771.20 USD
Germany
year 2016
4 projects
amount 975 520.04 USD
disbursement 745 520.10 USD
Assistance in preventing and combating corruption (KPK)
year 2016
1 project
amount 7 920.79 USD
disbursement 14 924.40 USD
Transforming Administration, Strengthening Innovation (TRANSFORMASI)
year 2016
1 project
amount 0.00 USD
disbursement 610 425.30 USD
Assistance in Preventing and Combating Corruption (KPK)
year 2016
1 project
amount 0.00 USD
disbursement 118 869.80 USD
Transforming Administration - Strengthening Innovation
year 2016
1 project
amount 967 599.25 USD
disbursement 1 300.60 USD
Switzerland
year 2016
1 project
amount 0.00 USD
disbursement 2 410 922.70 USD
ADB: Strengthening Tax Revenue Administration at Central and Local Levels in Indonesia
year 2016
1 project
amount 0.00 USD
disbursement 2 410 922.70 USD
United Kingdom
year 2016
1 project
amount -22 633.22 USD
disbursement -921.40 USD
Support to the Ministry of Finance on Low Carbon
year 2016
1 project
amount -22 633.22 USD
disbursement -921.40 USD
Totals
year 2016
10 projects
amount 111 657 970.36 USD
disbursement 114 137 502.50 USD
Donor
year Year
No. project
amount Commitment
disbursement Disbursement
Australia
year 2017
1 project
amount 145 200.90 USD
disbursement 145 200.90 USD
Government Partnership Fund Phase (GPF) II
year 2017
1 project
amount 145 200.90 USD
disbursement 145 200.90 USD
Canada
year 2017
2 projects
amount 0.00 USD
disbursement 395 575.64 USD
Improved Personal and Corporate Tax Revenue Administration/Amélioration de l'administration fiscale des particuliers et des sociétés
year 2017
1 project
amount 0.00 USD
disbursement 16 560.16 USD
Natural Resources for Development Program/Programme de ressources naturelles pour le développement
year 2017
1 project
amount 0.00 USD
disbursement 379 015.48 USD
Germany
year 2017
3 projects
amount 1 774.68 USD
disbursement 693 307.98 USD
Transforming administration - Strengthening innovation
year 2017
1 project
amount 0.00 USD
disbursement 373 904.51 USD
Assistance in Preventing and Combating Corruption (KPK)
year 2017
1 project
amount 0.00 USD
disbursement 289 171.71 USD
Transforming Administration, Strengthening Innovation (TRANSFORMASI)
year 2017
1 project
amount 1 774.68 USD
disbursement 30 231.76 USD
South Korea
year 2017
2 projects
amount 208 696.00 USD
disbursement 147 901.00 USD
Tax system and VAT administration (Indonesia)
year 2017
1 project
amount 140 870.00 USD
disbursement 85 380.00 USD
Master`s Degree Program in Finance and Tax Policy(17-19)
year 2017
1 project
amount 67 826.00 USD
disbursement 62 521.00 USD
Totals
year 2017
8 projects
amount 355 671.58 USD
disbursement 1 381 985.52 USD

Resources

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