House Passes Bill on Harmonization of Tax Regulations

Photo by: PR of Ministry of Finance.

The House of Representatives (DPR) on Thursday (07/10) passed the Bill on Harmonization of Tax Regulations.

The Bill aims to support tax reforms and provide a fair, prudence, effective, and accountable tax system.

The Bill contains six main provisions consisting of 9 chapters and 19 articles. The new provisions amend several provisions regulated in several tax laws, including Law on General Provisions on Tax, Law on Income Tax, Law on Value Added Tax and Sales Tax on Luxury Goods, Law on Excise, and Law on Voluntary Disclosure Program. The new provisions also regulate a Carbon Tax.

The COVID-19 pandemic has provided momentum and a new perspective in rearranging and building new economic foundations, including rearranging the tax system to be more resilient in overcoming the challenges of the pandemic and future dynamics.

The Tax reforms are in line with the Government measures to accelerate the economic recovery and improve the quality of fiscal policy as a policy instrument to support national development. The Bill, which is an integral part of the tax reforms, is also aimed at increasing the tax ratio and improving tax compliance.

The tax reforms are also expected to promote fairness and provide more legal certainty in the implementation of tax rights and obligations. (PR of Ministry of Finance/UN) (RI/LW)