Implications of Government Legal Subject Status as One of the Causes of Tax Disputes on Production Sharing Contracts for the Oil and Gas Industry in Indonesia (original) (raw)

The INVESTIGATION OF TAX DISPUTE IN INDONESIA

Jurnal Aplikasi Akuntansi

The study was aimed to examine the cases of tax dispute in Indonesia. This study will be identified the behavior of verdicts of the Supreme Court, especially indications of tax avoidance by taxpayer and identify the government's loss due to tax avoidance. The data use the verdicts of the Supreme Court regarding to tax disputes in the Supreme Court. Using logistic regression, this study revealed that taxpayer was facilitated to commit tax avoidance by the legal loopholes. The motivation of taxpayers in committing tax avoidance was to utilize the time during the dispute process in accordance to postpone the taxes payment. Delaying tax payment by applying the dispute, taxpayer get benefit from time value of money. From the analysis was, the Indonesian tax laws, somehow, provides opportunities for taxpayers to perform tax avoidance. Moreover, the study showed that the tax laws have not been implemented properly. Accordingly, the loss opportunity cost of the government due to tax avoidance by the taxpayers was approximately 10 billion rupiah. Therefore, based on the result of the study, we advised the government of Indonesia to do some policies, which are: 1) describe the legislation and taxation system with an objective definition; 2) designing administrative processes that can detect the tax avoidance, which is more stringent administrative processes; 3) shorten the processing of a tax dispute.

Main Issues of Value-Added Tax Dispute in Indonesia: A Note from 2019 Tax Court Decrees

Jurnal Kajian Akuntansi

Due to the lengthy, complicated, and expensive process, tax disputes in Indonesia are often in the spotlight. Moreover, the frequently recurring disputes for similar cases add to the long list of the issues. To that end, this study has two objectives. The first is to analyze Value Added Tax (VAT) concepts in Indonesia's regulations. The second is to analyze the VAT dispute according to the sample generated from the 2019 Tax Court decree. Thus, it is qualitative research with inductive reasoning using data collection techniques through documentation and literature studies. This study elucidates concepts underlying VAT regulations that have received scant attention in the prior literature. The core of the VAT dispute issues stems from divergent perspectives on VAT provisions between the tax authority and taxable persons. The primary issues in VAT disputes generally involve disagreements over interpretation and inaccuracies in supporting evidence on both the input and output sides....

Transfer Pricing Settlement in Indonesia: A Note for Tax Authority, Tax Court, and Taxpayers based on the Tax Court Decisions

BISNIS & BIROKRASI: Jurnal Ilmu Administrasi dan Organisasi

Transfer pricing disputes have been quite high and have been considered as an important issue in taxation system in Indonesia. The high level of these disputes should be a common concern, especially to examine how the dispute process occurred and how to resolve it. This study aims to discuss the tax auditor, taxpayer, and tax court judge behavior's prior to the transfer pricing issue and how to reduce the dispute. This study uses tax court decisions settled year 2015-2019 as the locus of the study. The research uses qualitative approach and qualitative method. The data was collected from the study documentation, literature review and interview to the key informants. The research shows that the increase of transfer pricing disputes might be caused by the aggressive tax audit behavior. This aggressive tax audit behavior resulted the less reliable audit finding that lead the taxpayer to submit the appeal to the tax court. Unfortunately, for many cases, the tax court decision seemed inconsistent. No certain indicators stated by the judges that a transaction has or has not satisfied the arm's length principle. Thus, tax court decision could not sufficiently be considered as a reference for future potential case. With this phenomenon, the tax auditor needs to increase the competence and comply with the tax audit guideline. Similarly, the taxpayer also needs to fully disclose their transfer pricing documentation. Finally, the judges should improve their expertise on transfer pricing and follow the international business dynamics.

LEGAL EFFORTS OF TAX MANDATORY OBJECTIVES ON TAX PROVISIONS (Study in the Regional Office of General Directorate of Taxation of South Jakarta I)

Yustisia Jurnal Hukum

The focus of this study is on the resolution of objections raised by Taxpayers in the Regional Office of DGT South Jakarta I. The theory used in this study refers to the opinion of Adam Smith in his book Wealth of Nations which states that a good tax collection must fulfill equity and equality requirements, certainty , convenience of payment, and efficiency. This study uses a naturalistic and interpretive qualitative approach that focuses on the process of resolving taxpayers' objections to a tax assessment as a legal effort. Data collection is done through interviews and direct observation on the object of research. The results of interviews and observations prove that the resolution of the objections to the South Jakarta I DGT Regional Office has been carried out in accordance with the provisions of the applicable tax regulations. This was also reinforced by statements made by Taxpayers who filed objections to the Regional Office of DGT South Jakarta I. The settlement of objec...

Utilizing Production Sharing Contracts (PSCs) as a Means for the Protection of Indonesia’s Natural Resources

Lentera Hukum

Indonesia has the potential to manage natural resources in such a way that social justice, public welfare, and the prosperity of the people is also realized. Contract law is the primary legal umbrella used in efforts to protect natural resources from exploitation. This study uses normative juridical methods that prioritize secondary data as the primary sources. This study shows the form of the legal protection of state assets related to oil and gas management including the government has the right of immunity, the existence of provisions regarding state revenue, state levies, and bonuses and the existence of provisions for contractors to distribute a portion of the production share. Thus, the government uses Production Sharing Contracts (PSC) to enter into oil and gas management agreements with contractors, specifically regarding upstream business activities. The Oil and Gas Law does not elaborate on the meaning of the PSC. Rather, it only states that the PSC is one form of the cont...

Reformulation of Tax Dispute Resolution in Indonesia

Journal of Law, Policy and Globalization, 2017

The researcher focuses on research the tax disputes arising from the issuance of tax assessment (SKP) central taxes administered by the Directorate General of Taxation, Ministry of Finance. Authors interested in researching tax dispute considering in the last decade there was an increase in the number of tax disputes that the dispute is highly significant, if in 2005 there were only 2,613 files received into the Tax Court, in 2015 tax disputes paid were 12.486 files [1] , or it increases more than fourfold. There should be a solution for the increase of number of tax disputes that is very significant to avoid the accumulation of case with a very great number of case that in the end will be difficult to resolve by the Tax Court, so that the settlement of disputes in the form of decisions that provide justice for the parties of lawsuit cannot be determined immediately, it is contrary to human nature that crave the justice.The arrangement of tax dispute resolution, it is done in stages...

Taxation in Democratic State: Quo Vadis Indonesia?

SOSHUM : Jurnal Sosial dan Humaniora, 2020

____________________________________________________________________ Public participation and interaction among state actors' in the process of tax policy formulation is a fundamental mechanism undertaken in a democratic state in realizing the agreeable policy. Indonesian taxpayers and citizens as members of a democratic state need to quest to what extend state actors have participated in the process of agenda-setting until the tax policy has been published to the public. This research is intended to scrutinize the dynamic roles of state actors' behavior and stakeholders on the tax policy process in Indonesia and how the measures should be taken to encourage their participation including on improving tax compliance. By using a qualitative paradigm, this research is done through documentation, deep interview, literature study, and technical data analysis in the form of qualitative data analysis with the inductive method. The result shows that parts of the component of state actors did not have a similar level of knowledge and concern on the taxation issue. The taxation issues would only in the interest of certain actors in which economic activity such as business entity when they directly affect them. Therefore, the discussion on taxation solely relates to how to optimize the state revenue and how the collected revenue could be spent. Public participation in the tax policy formulation process needs to be optimized so that tax compliance among society can be boosted.

General Tax Provisions and Procedures Issues on the Omnibus Law in Indonesia

International journal of scientific and research publications, 2021

This study aims to analyze policy issues regarding general provisions and tax procedures based on the tax omnibus law idea. In 2020, Law No. 28 of 2007 concerning General Tax Provisions and Procedures as ceremonial law has undergone substantial and fundamental amendments. The amendments are in Law No. 11 of 2020 concerning Job Creation. This research is a descriptive qualitative study using data techniques such as documentation and literature studies. The study concluded that the omnibus law's purpose was to encourage voluntary taxpayer compliance and increase legal certainty. This omnibus law policy shows the government's desire to provide justice and convenience to taxpayers. The rearrangement of administrative tax sanctions (interest, fines, increases) and interest returns that refer to the reference interest rate and the uplift factor component has met three indicators: time value of money, proportionality principle according to the error rate, and the principle of guilt. Also, regulatory amendments to achieve legal certainty can positively impact more optimal tax revenue in the future, reduce compliance costs, and reduce tax avoidance. However, this regulatory change needs to be in line with clear implementing regulations, not multiple interpretations, and still prioritizing socialization to the public. Index Terms-general tax provisions, omnibus law, tax compliance I. INTRODUCTION ax compliance is a crucial issue in both developed and developing countries. Taxpayers who do not comply will do tax evasion or evasion, causing tax revenue to decrease. Tax compliance also has a close relationship with tax law enforcement. Sanctions are an essential aspect of guaranteeing the state's right to tax revenue and ensuring that taxpayers comply with the law's provisions (Riyanto, 2020). However, Indonesia's formal tax compliance tends to fluctuate and has not been optimal even though it shows that registered taxpayers increase yearly. Some of the factors that cause low compliance are Indonesia's high tax compliance costs, the bureaucracy, and tax officials. Also, tax morale is the key to determining the extent to which taxpayers fulfill their tax obligations voluntarily. In the taxation context, tax morale is an intrinsic motivation to pay taxes. Individuals' willingness or moral obligation to pay taxes or their belief in contributing to society by paying taxes (Torgler, 2005, p. 526). Tax morale will guarantee public contributions through the tax system with or without a coercive approach, sometimes even in the absence of tax laws. Empirically, tax morale has an essential role in increasing voluntary compliance in developed and developing countries (OECD, 2019; Ali, Fjeldstad, & Sjursen, 2014). Various surveys by Afrobarometer, Asiabarometer, and Latinobarometro concluded that several aspects affect the level of tax morale, including satisfaction with public services, trust in government, perceptions of corruption, tax administration, and the imposition of sanctions by tax authorities for taxpayer violations (OECD, 2019). Therefore, in building tax morale, it must be through participatory and transparent tax policy formulation, a tax system that can reduce inequality, and tax imposition that reflects aspects of justice and legal certainty (Darussalam, 2020). The Directorate General of Taxes explained that one of the efforts to optimize tax revenue is applying the omnibus law. Tax optimization is from broadening the tax base and improving policy and administration, especially legal certainty. Minimizing tax uncertainty is the basis for achieving a suitable taxation model for businesses (Owens, 2019). The leading causes of tax uncertainty are tax regulations' complexity, including documentation requirements, inconsistent tax authorities' decisions, and the inability to achieve tax certainty through the roll-out mechanism (OECD, 2017). Based on the 2020 National Legislation Program, the Indonesian government has proposed two Bills that use the omnibus law method, namely the Bill on "Tax Provisions and Facilities for Strengthening the Economy" and the Bill on "Job Creation." In the plenary session, the People's Representative Council of the Republic of Indonesia (DPR RI) has officially ratified the Job Creation Bill (RUU) into Law No. 11 of 2020 on November 2, 2020, in the plenary session. The Job Creation Law implements the idea of the omnibus law as a legal breakthrough that can solve various problems in several overlapping regulations through synchronization into one law comprehensively. Garner in Black's Law Dictionary (2009, p. 186) defines the concept of the omnibus bill as "a single bill containing various distinct T

PERBANDINGAN TAX TREATY DALAM

Bab 5 PERBANDINGAN TAX TREATY DALAM MODEL OECD, UN, DAN MODEL INDONESIA UN OECD Model yang dikembangkan untuk memperjuangkan kepentingan negaranegara berkembang, sehingga prinsip sumber penghasilan tergambar dalam model ini. Model yang dikembangkan oleh negara-negara Eropa Barat, prinsip yang digunakan adalah azas pengenaan pajak domisili. Negara Indonesia dalam kebijakan di bidang persetujuan penghindaran pajak berganda atau P3B menggunakan campuran antara kedua model tersebut dan Undang-Undang Pajak Penghasilan. Menurut Rachmanto Surachmat, Indonesia menggunakan Model Indonesia yang dijadikan pijakan dalam perundingan P3B. 1 Perjanjian perpajakan mula-mula dicetuskan pada tahun 1921 oleh Liga Bangsa-Bangsa. Model ini merupakan dasar dari model yang dibuat pada tahun 1928 yang dipakai oleh negara-negara yang kemudian tergabung dalam 88 BAB 5: Perbandingan Tax Treaty dalam Model OECD, UN, dan Model Indonesia

Tax Evasion and Violation of Human Rights: The Case of Indonesia

Journal of Arts and Humanities, 2019

This article discusses the issue of tax collection from the public in order to finance state administrators in carrying out their duties to create a society that is just, prosperous, spiritual and material. However, the implementation of tax collection is highly loaded with the contents of the political interests of the authorities. As a result, tax less redistributed to the benefit of public as taxpayers. The good and bad of tax policy cannot be separated from the political will of the government because tax policy is a political product of the ruling government, even though in reality it is not entirely legal as a political product but partly a social, cultural, economic and legal product. Interest has a very close relationship with policies made by the government, regardless of whether the policy is pro-people or just the reverse. Corrupt taxation policies will lead to taxation policies that suppress the rights of taxpayers, while democratic taxation policies will provide welfare for the people through redistribution. The author will review tax policies in Indonesia that seem to be forced and depend on the willingness of legislators, the design of tax policies that are dominated by political power without public participation and very minimal in its distribution to the public. This paper discusses tax administration design and practice and tax law making process that are undemocratic, authoritarian and less useful for taxpayers in Indonesia.