Page 4 - Newsletter (New Provisions on Article 25 Income Tax Installment and Compliance Risk Management)

DDTC Newsletter Vol.02 | No.06 I October 2019 Page 4 of 5

New Provisions on Article 25 Income Tax Installment and
Compliance Risk Management

Efforts to Increase Taxpayer on risk analysis after the DSE is identified in the CRM
Compliance through Compliance Risk compliance map of the extensification function. The
extensification activity of implementation, follow-
Management (CRM) up, monitoring and evaluation will be conducted in
accordance with the provisions of the procedure for
The Indonesian government continues to work on extensification in the field of taxation.
several instruments to improve taxpayer’s compliance.
Moreover, the government itself is targeting a formal Second, the implementation of CRM for taxpayer
2
compliance rate for 2019 of 85%. On the other hand, the inspection and supervision activities. The draft the
trend of formal compliance over the past five years has compliance map in this stage will heavily relies on the
only been around 60% to 70%. level of likelihood of non-compliance and contribution
to revenue from the taxpayers. The data used in the
One of the efforts made by the government is by optimizing preparation of this CRM are reporting, payment, and
the compliance risk management (CRM) regulated reporting accuracy.
through the Director General of Taxes Circular Letter
Number SE-24/PJ/2019 regarding Implementation One of the activities related to the second stage of CRM
of Compliance Risk Management in Extensification, is constructing the list of priority targets for potential
Supervision, Inspection, and Collection Activities at the excavation (Daftar Sasaran Prioritas Penggalian Potensi/
Directorate General of Taxes (SE-24/PJ/2019). DSP3) of specific taxpayers. At this stage, the authority
also begins to use third party data with the intention for
The regulation, which was promulgated as of 11 supervising and inspecting taxpayers. One of data source
September 2019, defines CRM as a taxpayer compliance is the database of spontaneous information exchange.
risk management process carried out systematically by
the DGT. This risk management is implemented through The role of the Head of the Tax Office (Kantor Pelayanan
constructing the treatment options based on taxpayer Pajak/KPP) who acts as the Head of the Taxpayer
behavior and the capacity of its resources that can be Compliance Committee is also very crucial at this
used to increase compliance effectively while preventing stage. In connection with this role, the Head of the KPP
non-compliance. can determine the list of audit priority targets (Daftar
Sasaran Prioritas Pemeriksaan/DSPP) and the list of
The CRM implementation itself is a continuation of the tax priority supervision (Daftar Prioritas Pengawasan/OPP)
amnesty program and the Exchange of Information (EoI) after a set of specific mechanisms.
to enable tax authorities for setting a more sophisticated
and accurate taxpayer risk profile through the preparation Third, the implementation of CRM for tax collection
of a Compliance Map. Thus, the tax authority can achieve activities and distress warrant. Unlike the two previous
the organization’s strategic objectives by utilizing a stages where the map is formed based on the potential
decision-making tool. In its implementation, CRM will be for taxpayer non-compliance, this stage will set the map
divided into three main stages, namely extensification, based on the tendency of taxpayer to pay. This is due to the
supervision & inspection, and billing. CRM function on this stage which is closely related to the
efforts of the tax receivable disbursement optimization.
First, the implementation of CRM extensification One mechanism used for preparing the map is by forming
functions. This stage begins with the preparation of a list a priority list of tax collection actions (Daftar Prioritas
of extensification targets (Daftar Sasaran Ekstensifikasi/ Tindakan Penagihan Pajak/DPTPP).
DSE). The authority will then sort the taxpayer based

2 Redaksi DDTCNews, “Sri Mulyani Akui Target Kepatuhan Formal 85% Cukup
Berat,” (4 March 2019), Internet, can be accessed at: https://news.ddtc.co.id/
sri-mulyani-akui-target-kepatuhan-formal-85-cukup-berat-15201

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