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Tax dodgers owe $2.7b
Feb 9, 2010
Trucks haul coal at the Kaltim Prima Coal's Sangatta site in Sangatta, Indonesia. Private-sector firm Kaltim Prima Coal (KPC), a unit of listed coal miner Bumi Resources BUMI.JK are among the named tax dodgers. -- PHOTO: BLOOMBERG
JAKARTA - INDONESIA'S 100 worst tax dodgers, including state and private firms, owed almost US$1.9 billion (S$2.7 billion) in 2009, tax office data showed, highlighting the difficulty of collecting revenues and the burden on government finances.
Indonesia's finance ministry has undergone sweeping reforms of the tax and customs departments in order to improve collection of state revenues and potentially reduce the government's dependence on the domestic and international bond markets.
'Tax revenue in Indonesia should be four or five times larger than it is,' said James Bryson, a Jakarta-based fund manager at HB Capital, adding that effective tax collection'would mean the government has to raise significantly less debt in its budget and it would make an already healthy balance sheet look even better.'
Mr Bryson said that if the 100 companies on the list paid the $1.9 billion tax owed, Indonesia would be able to cut the size of its planned 2010 bond issuance by around 10 per cent. The finance ministry planned to raise 175.1 trillion rupiah of debt this year to repay maturing bonds and help plug a budget deficit seen at 1.6 percent of GDP.
Tax evasion remains rife, despite reforms, prompting the tax office to decide on a 'name and shame' policy whereby parliament was last month presented with a list of the 100 companies with the biggest tax debts. State-owned oil and gas firm Pertamina and carrier Garuda Airlines, as well as private-sector firm Kaltim Prima Coal (KPC), a unit of listed coal miner Bumi Resources BUMI.JK are among those named, according to a copy of the tax document with Reuters.
Bumi is controlled by businessman and politician Aburizal Bakrie, who heads the Golkar Party and is considered an opponent of Finance Minister Sri Mulyani Indrawati's reform drive. -- REUTERS
Feb 9, 2010
Trucks haul coal at the Kaltim Prima Coal's Sangatta site in Sangatta, Indonesia. Private-sector firm Kaltim Prima Coal (KPC), a unit of listed coal miner Bumi Resources BUMI.JK are among the named tax dodgers. -- PHOTO: BLOOMBERG
JAKARTA - INDONESIA'S 100 worst tax dodgers, including state and private firms, owed almost US$1.9 billion (S$2.7 billion) in 2009, tax office data showed, highlighting the difficulty of collecting revenues and the burden on government finances.
Indonesia's finance ministry has undergone sweeping reforms of the tax and customs departments in order to improve collection of state revenues and potentially reduce the government's dependence on the domestic and international bond markets.
'Tax revenue in Indonesia should be four or five times larger than it is,' said James Bryson, a Jakarta-based fund manager at HB Capital, adding that effective tax collection'would mean the government has to raise significantly less debt in its budget and it would make an already healthy balance sheet look even better.'
Mr Bryson said that if the 100 companies on the list paid the $1.9 billion tax owed, Indonesia would be able to cut the size of its planned 2010 bond issuance by around 10 per cent. The finance ministry planned to raise 175.1 trillion rupiah of debt this year to repay maturing bonds and help plug a budget deficit seen at 1.6 percent of GDP.
Tax evasion remains rife, despite reforms, prompting the tax office to decide on a 'name and shame' policy whereby parliament was last month presented with a list of the 100 companies with the biggest tax debts. State-owned oil and gas firm Pertamina and carrier Garuda Airlines, as well as private-sector firm Kaltim Prima Coal (KPC), a unit of listed coal miner Bumi Resources BUMI.JK are among those named, according to a copy of the tax document with Reuters.
Bumi is controlled by businessman and politician Aburizal Bakrie, who heads the Golkar Party and is considered an opponent of Finance Minister Sri Mulyani Indrawati's reform drive. -- REUTERS
