Page 3 - Newsletter (Towards Certainty in Tax Dispute Resolution)

DDTC Newsletter Vol.01 | No.07 I June 2019 Page 3 of 6

Towards Certainty in Tax Dispute Resolution

• deduction or cancellation of an incorrect notice of containing the identity of the tax treaty partner’s
tax assessment (Article 36 paragraph (1) point b of domestic taxpayer associated with the request
the UU KUP). for MAP implementation;
o a list of information and/or evidence or
Should the request for MAP implementation be submitted
information held by the applicant which shows
along with the application for the three efforts, the
that the tax treatment by the tax authority of the
material submitted for the request for MAP implemented
tax treaty partner is not in accordance with the
must be included in the disputes material submitted in
tax treaty provisions; and
the application.
o a statement of the applicant’s willingness to
3. Not Delaying Obligations submit complete information in a timely manner.
Similar to the previous regulation, requests for MAP 6. Examination of MAP Request
implementations do not delay the obligation to pay tax
Prior to entering into the follow-up in the form of
payable and tax collection. This is in accordance with the
negotiations on MAP implementation, an examination
legislation in the field of taxation.
is performed on the request for MAP implementation.
4. Time Limit PMK 49/2019 states that such examination is carried
out in two aspects, namely the completeness of the
Having received the results of the examination related to
requirements for MAP implementation and the suitability
the completeness of MAP implementation request, the
of the material with the taxation treatment as the basis
Director General of Taxes will issue a written notification
for submission.
to the related taxpayer concerning whether the MAP
request requirement can be followed-up no later than 1 The Director General of Taxes follows up on the
month after the receipt of MAP implementation request. examination results related to requests for MAP
implementation submitted by the applicant. The follow-
If this time limit is exceeded, the MAP request is deemed
up may take the form of the issuance of a notification letter
to be entitled to a follow-up. Meanwhile, the negotiations
whether such request can be followed up or rejected no
during the MAP implementation which used to take years
and result in uncertainty for the WP are now limited to 2 later than a month since the receipt of the request for
MAP implementation. If the time limit is exceeded and
years.
the Director General of Taxes has not issued a written
notification, the request for MAP implementation is
As the process takes place, the Director General of Taxes
considered entitled to a follow-up.
will also follow up on the results of negotiations by
issuing a decree within a maximum period of 2 months
Specifically for direct submissions by the Director General
from the receipt or submission of written notification
of Taxes, the Director General of Taxes issues a written
from or to tax treaty partner authorized officials.
request for MAP implementation to authorized tax treaty
5. Administrative Requirements partner officials and a written notification regarding the
submission of requests for MAP implementation to the
The administrative requirements for MAP implementation related domestic taxpayer.
requests are as below:
• written submission in Indonesian; If the request does not receive a written response from
• expresses discrepancies in the application of tax the tax treaty partner authority within a maximum
treaty provisions according to the applicant; period of 8 months after its submission, the Director
General of Taxes issues a written notification that the
• submitted within the time limit as stipulated in the
request for MAP implementation cannot be followed up
tax treaty or no later than 3 years if not regulated in
or is revoked.
the tax treaty, starting from:
o date of the notice of tax assessment;
The applicant may re-submit the request for a MAP
o date of tax receipts, withholding, or collection; or implementation request that has been rejected or
o the occurrence date of the tax treatment that is deemed not entitled for a follow-up provided that the
not in accordance with the provisions of the tax time limit – as stipulated in the tax treaty or no later
treaty. than 3 years if it is not set in the tax treaty – has not been
exceeded.
• signed by the applicant or his representative as
referred to in Article 32 paragraph (1) of UU KUP;
and 7. MAP Negotiation Process
• attached with: Negotiations are carried out through direct meetings,
o a certificate of domicile or other document telephone calls, video conferences, and/or other