Indonesia claims success in tax amnesty program

Indonesia claimed to have been successfully gaining world's best figures resulted from government-initiated tax amnesty program aimed at repatriating taxpayers' funds stashed in foreign countries.

The success can be seen from enormous figures recorded in the declared funds, taxpayers' enthusiasm and amnesty penalty funds, a senior Indonesian president's aide said here on Thursday.

"International community has conveyed their appreciation. This is for the first time on world's (fiscal) history. Our tax amnesty has recorded the highest figures in any aspect," Cabinet Secretary Pramono Anung said, adding that results of tax amnesty program would eventually highly contribute to the nation's efforts to pursue higher growth.

As of now Indonesian taxpayers signing up for tax amnesty program have declared a total of 2,963 trillion rupiah (about 229 billion U.S. dollars) of their unreported assets, or 74 percent from 4,000 trillion rupiah (about 308.4 billion U.S. dollars) targeted by government.

The tax amnesty program that took into effect since June this year had collected some 64.9 trillion rupiah (about 5 billion U.S. dollars) in amnesty penalty funds so far, or almost 40 percent from the target set at 165 trillion rupiah (about 12.7 billion U.S. dollars). The funds would be used as additional to the nation tax revenue.

The initial period of tax amnesty program that offers the most lenient penalty of 2 percent would expire on Sept. 30.

It would be followed later with further periods that charging 3 percent penalty and 5 percent penalty with expiration schedules in December this year and March 2017.

From the amnesty penalty fund aspect, during the initial period Indonesia's tax amnesty program has recorded the highest contribution at 0.65 percent to national Gross Domestic Product (GDP) compared to total results of similar program previously held in other countries.

Indonesia's figure was higher than 0.62 in Chile, 0.58 in India, 0.17 in South Africa, 0.04 in Australia, 0.12 in Spain and 0.15 in Belgium.

Good impacts from the government's tax amnesty program have already persisted in the nation's stock market as its composite index has improved significantly, indicates improving trust to Indonesia's economy and business, Pramono said.

"We believe capital inflow from foreign investors would flood in later on," he added.

Positive impact was also seen in the improving national currency's exchange rate value against the U.S. dollar as it has increased 6 percent this year, reports said.

Indonesian President Joko Widodo was optimistic that the tax amnesty would gain further success with more declared assets to be pledged by more taxpayers.

"We must learn from this kind of movement, momentum and trust have emerged," the president said earlier on Wednesday during his visit to a large tax office here to see activities related to implementation of tax amnesty program. Enditem