Monday, August 11, 2014

Taxpayer and constitutional right in Constitutional Court

Taxpayer and constitutional rights, should we go to Constitutional Court for judicial review?

The taxpayer, PT Cotrans Asia, has challenged article 23(2) of Income Tax Law (ITL) about withholding tax which is deemed to be causing loss on the taxpayer's constitutional rights or have potential to cause loss for the taxpayer as a company in shipping service. The article 23(2) of ITL stipulates:
" Ketentuan lebih lanjut mengenai jenis jasa lain sebagaimana dimaksud pada ayat (1) huruf c angka 2 diatur dengan atau berdasarkan Peraturan Menteri  Keuangan".

or in English version
"Further provisions concerning other types of services as referred to in paragraph (1) letter c number 2 is regulated by or under the Minister of Finance".

Taxpayer  argued to the Court  that the article 23(2) of ITL should be tested using article 22A, 28D, 28I of Undang-Undang Dasar 1945 (1945 Constitution) which state, among others, that everyone has the right to get freedom from discriminating treatment and has the right to get protection from the discriminating treatment.
Further, taxpayer's argument also mentions several things including the fact that Directorate General of Taxation (DGT) has no right to determine characteristics for shipping services if it is again other Law, e.g. Shipping Law. Additionally DGT should follow other Laws and regulation in its ruling which may determine business characteristics.

Accordingly, taxpayer is of opinion that article 23(2) of ITL should be declared as non binding if it is interpreted without considering other Laws in Indonesia.

During hearing process, taxpayer added that one of the problems due to article 23(2) of ITL is DGT may interpret that article 23(2) or article 15 should apply for shipping service. The panel of judges questions if the main issue is actually on the Regulation of Ministry of Finance, if yes, the Constitutional Court is not the right place.  It is indeed interesting to see the opinion from the panel of judges in the hearing process.

Previously other taxpayer has filed judicial review regarding PTKP or other tax allowance and rejected by the Court, could this taxpayer win the case?

Versi Indonesia

Wajib Pajak dan hak konstitusional,  haruskah kita pergi ke Mahkamah Konstitusi untuk judicial review?

Wajib pajak, PT Cotrans Asia, telah menantang pasal 23 (2) dari UU PPh (yang dianggap menyebabkan kerugian hak konstitusional wajib pajak atau memiliki potensi untuk menyebabkan kerugian bagi wajib pajak sebagai perusahaan dalam pengiriman layanan. Pasal 23 (2) UU PPh menetapkan:
"Ketentuan lebih lanjut mengenai jenis jasa lain sebagaimana dimaksud pada ayat (1) huruf c angka 2 diatur dengan atau berdasarkan Peraturan Menteri Keuangan".

Wajib Pajak telah menyatakan kepada Majelis bahwa pasal 23 (2) UU PPh harus diuji menggunakan pasal 22A, 28D, 28I Undang-Undang Dasar 1945 yang menyatakan, antara lain, bahwa setiap orang memiliki hak untuk mendapatkan kebebasan dari perlakuan diskriminatif dan berhak untuk mendapatkan perlindungan dari perlakuan diskriminatif.

Selanjutnya, argumen wajib pajak juga menyebutkan beberapa hal termasuk fakta bahwa Direktorat Jenderal Pajak (DJP) tidak memiliki hak untuk menentukan karakteristik untuk jasa pengiriman jika lagi UU lainnya, misalnya UU Pelayaran. Selain itu DJP harus mengikuti Hukum lainnya dan peraturan dalam keputusannya yang dapat menentukan karakteristik bisnis.

Dengan demikian, wajib pajak berpendapat bahwa pasal 23 (2) dari UU PPh harus dinyatakan sebagai non mengikat jika ditafsirkan tanpa mempertimbangkan Hukum di Indonesia.

Selama proses sidang, wajib pajak menambahkan bahwa salah satu masalah karena pasal 23 (2) dari UU PPh adalah DJP dapat menafsirkan bahwa pasal 23 (2) atau pasal 15 UU PPh harus berlaku untuk layanan pengiriman. Majelis hakim pertanyaan jika masalah utama adalah benar-benar di Peraturan Menteri Keuangan, jika ya, Mahkamah Konstitusi bukanlah tempat yang tepat. Hal ini memang menarik untuk melihat pendapat dari majelis hakim dalam proses persidangan.

Sebelumnya wajib pajak lainnya telah mengajukan judicial review mengenai PTKP atau tunjangan pajak lainnya dan ditolak oleh Pengadilan, bisa wajib pajak ini memenangkan kasus ini?

Note: the original version is in English, the second one is to help some readers

Tuesday, June 3, 2014

Pajak dan pemberantasan korupsi - pelajaran dari Jepang dan OECD

Satu berita di internet membuat terkejut, tentang berita tuduhan korupsi dan suap dari perusahaan Jepang di Indonesia, namun yang menarik adalah bagian yang menyatakan bahwa informasi diperoleh dari badan otoritas pajak di Jepang seperti disebutkan dibawah ini
" Sedangkan seperti dilansir AFP, Rabu (4/6/2014), skandal ini mulai mencuat pada Maret lalu ketika media Jepang melaporkan bahwa badan pajak nasional setempat menemukan adanya pembayaran sebesar 100 juta Yen (Rp 11 miliar) yang tidak bisa dipertanggungjawabkan.

Muncul kecurigaan bahwa JTC yang terlibat sejumlah program bantuan pembangunan pemerintah negara-negara lain di Asia, telah memberikan suap kepada pejabat-pejabat di Vietnam, Uzbekistan dan Indonesia. JTC kemudian melakukan penyelidikan sendiri secara independen hingga berujung pada laporan bulan April yang menyebutkan adanya pembayaran 'uang pelicin'".

Satu hal yang menarik, bahwa sebenarnya badan otoritas pajak dapat menjadi pendukung pemberantasan korupsi.

Menariknya, dalam berita tersebut juga dijelaskan bahwa di Vietnam telah ada yang telah ditangkap terkait masalah ini, bagaimana dengan Indonesia?

Pelajaran dari OECD
Dalam hal korupsi dan pajak, OECD telah menerbitkan laporan berjudul, Bribery and Corruption Awareness Handbook for Tax Examiners and Tax Auditors, yang berisi antara lain
"The existence of legislation denying the tax deductibility of bribes is a strong deterrent  to bribery of foreign public officials. Nevertheless, the practical implementation of such  legislation should not be neglected. The deterrent effect of these legislative changes depends  crucially on the measures put in place to ensure that taxpayers are complying with the law. 

As legislation denying the tax deductibility of bribes to foreign public officials was being  put in place in many countries, the Committee on Fiscal Affairs (CFA) decided to pursue its  work on the implementation of such legislation by designing a manual to assist tax examiners with identifying suspicious payments likely to be bribes. The present Bribery Awareness  Handbook for Tax Examiners also aims to assist countries in making their tax examiners  aware of the various bribery techniques used as well as giving them the tools to detect and identify bribes of foreign public officials and bribes to public officials in the domestic  context. The Handbook provides useful legal background information as well as practical  tips: indicators of bribery, interviewing techniques and examples of bribes identified in tax  audits. The Handbook also includes a standard form for feedback by the tax examiner to  their headquarters in order to facilitate the monitoring of trends and assessing risks"

Laporan diatas menjelaskan masalah dan hal yang sebaiknya dilakukan oleh pemeriksa pajak apabila mereka menemukan penyuapan baik terhadap pejabat pemerintah dalam negeri dan luar negeri.

Hal ini sebenarnya dapat saja diterapkan di Indonesia termasuk di negara-negara non OECD dan dapat mendukung anggapan bahwa badan otoritas pajak suatu negara dapat menjadi pendukung atas pemberantasan korupsi.






Wednesday, May 21, 2014

OECD Analysis for Indonesian Taxation

OECD  issued an analysis for Indonesian taxation in a newly published report, RevenueStatistics in Asian Countries Trends in Indonesia and Malaysia 1990-2012, which includes not only the statistics of the revenue,  but also policy challenges which could be used by the public to understand the current situation and consider possible solution to solve taxation issues.

Below is the summary of the new report (which also consists of Malaysian taxation):
-In 2012, in Indonesia the tax burden increased to 12.9%
-taxes on incomes and profits represent 44% of tax revenues in Indonesia and this compares with 30% in both Japan and Korea and 34% for OECD countries.
-revenues from corporate account for 70% in Indonesia.
-tax revenues as a proportion of national incomes in Indonesia and Malaysia are substantially lower than in Korea and Japan. In 2011, the ratios in Indonesia and Malaysia ranged from 12-16% compared with 26-28% in the two countries that are OECD members. The OECD average was higher still at 34.1%.
-there were increases of 4 percentage points in Indonesia (9% to 13%) and Korea (23% to 27%) and of 2 to 3 percentage points in Japan (27% to 29%) and Malaysia (14% to 17%). This compared with the OECD average estimated at 34.6% in 2012 which represented a marginal decline compared with 2000

Previously, in 2012, OECD also made a report about Indonesia, OECD Economic Survey, which include taxation issues, among other things, as follows:

-Key policy recommendations for taxation :
Move the resource-sector tax regime closer to a system of taxing rents. Review export taxes, considering their implications for the whole economy, including international trade. Phase out exemptions from VAT. Revisit corporate tax holidays granted to firms in “pioneer industries”.
 Enhance efforts to bring the self-employed into the tax net, including by reducing temporarily penalties for previous non-compliance for first-time taxpayers only. Increase resources devoted to auditing high-risk and affluent taxpayers, and make more use of third-party information to assess tax liabilities.

- Recommendations on raising tax revenues
Broadening the tax base
• Move the resource-sector fiscal regime closer to a system of taxation of rents.
• Review export taxes, considering their implication for the whole economy, including international trade.
• Phase out exemptions from VAT.
• Revisit corporate tax holidays granted to firms in “pioneer industries”.
Improving tax compliance
• Enhance efforts to bring the self-employed into the tax net, including by reducing temporarily penalties for previous non-compliance for first-time taxpayers only.
• Increase resources devoted to auditing high-risk and affluent taxpayers, and make more use of third-party information to assess tax liabilities.


The Indonesian government is concerned since the tax ratio has been relatively low and there is no significant increase on the tax ratio. 
The other concern is about the independence of tax authority which lead to a question, is it a must for tax authority to become an independent institution which be directly below president and no longer part of Ministry of Finance. The idea is to establish, at least, semi-autonomous tax authority which will have more authority, e.g. human resource and recruitment, policy making etc. as discussed in here 


Wednesday, April 9, 2014

Dirjen Pajak, badan otonom dan arah perpajakan?

Mau dibawa kemana Direktorat Jenderal Pajak?

Beberapa bulan ini wacana agar DJP melepaskan diri Kementerian Keuangan menguat dengan berbagai alasan, dalam hal pengelolaan SDM hingga organisasi dan lain hal seperti dijelaskan disini hingga disini bahkan perbandingan antara otoritas pajak Indonesia dan otoritas pajak di Zambia dan Jerman 

Masalah yang sebenarnya sudah cukup lama dibahas namun diperlukan kemauan politik dari pemerintah

Belakangan bahkan muncul petisi agar KPU meminta pemerintah mewajibkan calon presiden untuk memberikan program dalam hal perpajakan. Dalam hal tim ekonomi capres, yang ada kebanyakan hanyalah hal normatif  tanpa menjelaskan darimana penerimaan pemerintah akan tercapai seperti diberitakan disini.

Beberapa hal yang dicatat dari berbagai sumber diatas:
-Pajak merupakan masalah penting karena sekitar 80% penerimaan negara berasal dari uang pajak, tanpa pajak pembangunan tidak akan dapat berjalan dengan baik
-Otoritas pajak yang independen dapat meningkatkan penerimaan pajak seperti terlihat di negara lain termasuk Zambia
-Perlu dukungan pemerintah untuk memutuskan apakah pajak yang selama ini setara eselon 1 atau Direktorat Jenderal dapat menjadi badan otonom di bawah Presiden dengan kewenangan tersendiri dalam hal anggaran hingga Sumber Daya Manusia (SDM)
-Badan otonom diharapkan dapat meningkatkan tax ratio di  Indonesia

Tulisan ini juga merupakan sambungan dari tulisan sebelumnya tentang Dirjen Pajak dan permasalahan yang ada. Di tengah masa pemilu ini, penulis berharap akan badan otoritas pajak yang lebih baik di Indonesia.

Semoga!

Transfer Pricing Regulation - Updated in 2013

In 2013, Directorate General of Taxation has issued two TP Regulations which provide guidance as follows

a.DGT Regulation No. PER-22/PJ/2013 dated 30 May 2013 about tax audit procedures.  The regulation provides procedures on how to prepare and conduct audit including these issues:
-application of arm's length principle (ALP)
-identification of taxpayer's business
-how to choose TP Method

b. DGT Circular No. SE-50/PJ/2013 dated 24 October 2013 as a technical audit guide for transfer pricing, which is related to DGT Regulation No. PER-23/PJ/2013 dated 11 June 2013 on the tax audit standard. The circular gives a specific standard on how tax auditor should run their audit :
-Differentiation between special and routine audit
-The things that the tax auditor has to do for transfer pricing audit, since it is issued in relation to DGT Regulation about standard of tax audit which includes working papers and samples of items which have to be checked during audit.
-This circular revokes the previous circular, SE-04/PJ.7/1993.

Looking at the circular and the regulation, there might be several things needed for further clarification:
-Royalty payment is one of hottest topic for transfer pricing audit for both direct and indirect taxes and it deserves further and more detailed clarification
-Specific TP guidance for different issues for developing countries as noted in UN Practical Manual for Transfer Pricing are not specifically addressed in both regulations. It is interesting to see BRICS countries have responded to the report.
-Comparability issues for developing countries should be taken into account in Indonesia as also noted in UN Practical Manual.
-Should Indonesia pay more attention to Base Erosion and Profit Shifting which has drawn lots of attention from many countries? Transfer Pricing is obviously one of the issues in the report.

We also need to look at previous regulation to understand the issues of Transfer Pricing in here and here 

Catatan :
Peraturan Transfer Pricing terbaru di tahun 2013 merupakan satu kemajuan meski ada beberapa hal yang meski masalah topik panas yang khas Indonesia belum dijelaskan secara rinci

Wednesday, March 12, 2014

Transfer Pricing - Arm's Length Profit for Corporate Spin-off in Indonesia

A case of an automotive company brought to the Indonesian Tax Court has raised questions about the possibility to use arm's length principle for corporate spin-off or generally for business restructuring. In this case, tax authority has challenged the arm's length profit of a company after the spin-off of a certain business unit as part of the domestic business restructuring of the Indonesian company.

Facts
The company, let's call it A Corp., has been audited by Directorate General of Taxation (DGT) and during the audit the tax authority found that the company's profit after the spin-off has decreased with the following facts:
-a division was spun off from its previous company, X Corp, and became a separate entity, a new company, A Corp.
-After the new company, A Corp., was established, it was later found out that the X Corp's gross margin has decreased significantly and even if the gross margins of the A Corp and X Corp are combined, the overall gross margin is even still lower before the spin-off. 
-The tax authority challenged it and raised questions about the arm's length profit. Tax authority also believes that it might be due to royalty and non arm's length purchase price.
-DGT is of opinion that spin-off should not lower the gross margin before the spin-off. DGT compares A Corp.'s  gross margin  with competitor's gross margin and decides that A Corp.'s gross margin is lower. 
-A Corp has related party transactions with its related entity in Indonesia and other country.
-The transfer price, which is allegedly not arm's length, will be able to avoid higher indirect tax i.e. VAT. It is noted, based on the audit, that A Corp has sold its manufactured products to its related parties, in Indonesia and abroad, below the arm's length price to decrease the profit.

Having seen the facts above mentioned, we are likely to conclude that DGT is pursuing arm's length profit before and after the business restructuring.

After hearing process, the Tax Court has to decide on this case and after the decision is made, the taxpayer is still able to pursue judicial review from the Supreme Court.  

Comments
Looking at the facts, some questions need to be answered.  

Since domestic related party transactions also take place between related parties in Indonesia, does the domestic transfer pricing rule apply? Pursuant to DGT Regulation No. PER- 32/PJ/2011 about arm's length principle, it is stated on Art.2 that domestic transfer pricing rule applies on (i) certain business sector whose final and non final income tax is applied, (ii) sales tax on luxury goods, and (iii) production sharing contract for oil and gas.  Further, it is stated in the DGT Regulation No. PER-22/PJ/2013 about transfer pricing audit guide which states that domestic transactions could be used for profit shifting due to differences of tax rate between domestic companies.

The basis for transfer pricing rule is Art. 18(3) of Income Tax Law which mentions that DGT has the authority to re-determine the amount of incomes and reduction as well as to re-determine debts as capital to calculate the amount of taxable incomes for taxpayer possessing special relation with other taxpayer in accordance with equity and common practice of business that is not influenced by a special relation by means of price ratio method among independent party, re-sale price method, costs-plus method, or other methods. 
Also based on the elucidation, there is no wording which is likely to say that spin-off should be part of transfer pricing rule.

This off-the-beaten-path case reminds me of other case inIndia which has made many people wonder about the use of transfer pricing rule for share issuance.

The author has no information on how the Tax Court decided on this case but this story has been reported on a national daily newspaper last year. 

Tuesday, March 11, 2014

Offshore Bank, Financial Center dan Penggelapan Pajak di Indonesia


                                                     Harian Kontan, 10 Maret 2014


Benarkah simpanan uang di luar negeri dapat dilakukan agar penghasilan kita tidak terlacak? Terdakwa kasus korupsi dari KPK, terungkap dalam penyadapan, berbicara tentang rekening bank  di British Virgin Islands (BVI) yang menurutnya tempat orang Indonesia  menyimpan dan mencuci uang.

Di BVI, selain beberapa negara lain yang dikenal sebagai financial center, banyak perusahaan perantara didirikan untuk menghindari pajak dan menjadi salah satu pendorong OECD membuat studi atas base erosion dan  profit shifting dari perusahaan multinasional.

Direktorat Jenderal Pajak berkeinginan memperoleh akses atas  rekening perbankan di Indonesia terutama 180.000 rekening  orang kaya untuk meningkatkan kepatuhan Wajib Pajak namun rencana ini dikabarkan dapat memicu nasabah Indonesia untuk memindahkan uang mereka terutama ke Singapura dimana diperkirakan lebih dari 1.500 trilyun rupiah tersimpan (Kompas, 27 Februari 2014).

Jika demikian, benarkah data rekening bank dan keuangan di negara-negara pusat keuangan dapat dan perlu dibuka serta permasalahan apa yang terjadi?

Offshore bank, seperti yang terdapat di negara pusat keuangan di Singapura, Hong Kong, Swiss hingga BVI, adalah cara yang dapat dipakai untuk menyembunyikan uang atau penghasilan tidak hanya dari penegak hukum atas kasus korupsi dan pencucian uang namun juga dari otoritas pajak agar penghasilan tersebut tidak dikenakan pajak. Setali tiga uang, uang yang disembunyikan harus tidak dapat dilacak oleh otoritas pajak dan penegak hukum. Bagi otoritas pajak, penghasilan dari tindak kejahatan, termasuk korupsi, adalah penghasilan kena pajak yang bila tidak dilaporkan dapat dikenakan sanksi pidana penjara maksimal selama 6 tahun dan denda maksimal 4 kali jumlah pajak terutang yang tidak atau kurang dibayar sesuai pasal 39 UU Ketentuan Umum Perpajakan.

Pelaporan Pajak
Setelah kasus UBS Bank di Swiss dimana banyak nasabah warga  Amerika Serikat (AS)  menyembunyikan penghasilan agar tidak membayarkan pajak, di tahun 2010, AS mengesahkan Foreign Account Tax Compliance Act (FATCA) yang mewajibkan warga AS termasuk permanent resident untuk melaporkan rekening bank atau keuangan serta aset yang mereka miliki di luar negeri dengan sanksi atas mereka yang tidak melaporkannya. FATCA juga berusaha meminta pelaporan dari institusi keuangan luar AS untuk melaporkan informasi keuangan dari warga AS.  FATCA, yang direncanakan akan diikuti juga oleh Singapura, dikabarkan membuat institusi keuangan di Swiss berusaha tidak berurusan dengan warga AS karena akan merepotkan mereka dalam pelaporan informasi pajak..

Di Inggris, wajib pajak berkewajiban melaporkan penghasilan mereka di luar negeri dalam  lampiran khusus pelaporan pajak tahunan, termasuk bunga, dividen atau capital gain dan sewa hingga penghasilan yang tidak dapat dikirimkan kembali ke Inggris. Hal ini sebenarnya juga dapat diterapkan untuk wajib pajak kaya (High Net Worth Individual) di Indonesia yang bahkan memiliki kantor pajak tersendiri.

Pada February 2014, OECD menerbitkan satu laporan tentang standar atas Automatic Exchange of Financial Account Information antar negara untuk melakukan pertukaran secara otomatis tidak berdasar “on request” yang dapat digunakan untuk mengatasi penggelapan pajak dari harta di luar negeri karena standar ini mendukung pertukaran informasi keuangan dari institusi keuangan, apa saja yang perlu dilaporkan, jenis account dan pembayar pajak yang dicakup serta due dilligence yang perlu dilakukan oleh institusi keuangan. Kekurangan standar yang juga didukung G20 ini tidak mencakup data pengguna safe deposit box atau sanksi yang jelas untuk yang tidak mematuhinya.

Indonesia telah menandatangani Tax Information Exchange Agreement (TIEA) dengan negara-negara pusat keuangan yakni Bermuda, Guernsey, Isle of Man, Jersey dan San Marino[1] untuk bertukar informasi perpajakan walau belum berlaku efektif. TIEA yang tidak sama dengan tax treaty dibuat oleh negara-negara yang sering disebut sebagai tax haven dan berisi perjanjian pertukaran informasi keuangan, seperti data perbankan dan institusi keuangan serta data kepemilikan perusahaan, partnership, trust, yayasan hingga collective investment schemes. 

Penghindaran vs Penggelapan
Yang dilakukan wajib pajak di negara-negara pusat keuangan tidak hanya penggelapan namun juga penghindaran pajak dengan pendirian perusahaan perantara hingga pendirian trust, satu entitas yang didasarkan common law seperti di Inggris. Margaret Thatcher  dikabarkan menggunakan offshore trust di BVI untuk kepemilikan properti senilai 12 juta poundsterling di London untuk menghindari pajak. Warga Indonesia bahkan dapat menggunakan Business Trust di Singapura untuk mengelola kekayaan di Indonesia serta bagian dari perencanaan pajak.

Dalam kasus penggelapan pajak Asian Agri,  putusan Mahkamah Agung No. 2239 K/PID.SUS/2012  menjelaskan penggunaan special purpose vehicle  company di Hong Kong, Macau dan BVI yang melakukan under invoicing untuk barang yang dijual Asian Agri sehingga merugikan penerimaan pajak. Di Italia, terdapat kasus Dolce &  Gabbana yang dituduh melakukan penggelapan pajak dengan penjualan merek Dolce & Gabbana dengan harga yang tidak wajar (arm’s length) ke perusahaan perantara di Luxembourg sehingga mereka dituduh tidak melaporkan penghasilan lebih dari 1 milyar euro.

Kesimpulan
Penggelapan dan  penghindaran pajak, yang diduga erat terkait dengan kejahatan lainnya, dapat dilakukan di negara yang menjadi pusat keuangan serta offshore bank. Dirjen Pajak perlu dan dapat menggunakan pertukaran informasi keuangan, termasuk rekening bank dan data perusahaan di luar negeri, dengan otoritas pajak luar negeri untuk mengatasi masalah tersebut dan perlu mewajibkan pelaporan penghasilan dan aset di luar negeri bagi wajib pajak secara khusus dalam pelaporan pajak.


Catatan: 
Tulisan ini adalah versi asli sebelum diedit oleh redaksi Harian Kontan dan diterbitkan dalam rubrik opini  pada Senin, 10 Maret 2014 
Beberapa bagian penting dari tulisan ini tidak ada dalam tulisan di Harian Kontan karena hasil edit dari redaktur.