Bill on Tax, Business Sectors and Investment in Indonesia

Author/Researcher : Rr. Adeline Melani

In order to bolster the role of law as the main contributor of the nation’s budget, the government has made some reformations on the tax regulation. In 2005, the government put forward a proposal of the tax regulation reformation in 2005. This proposal of tax reformation has received a serious attention from both business owners and tax experts. The tax reformation, which is originally hoped to benefit all parties, turns out to have caused disagreement between the government and the business owners as the representatives of the business sector in general and the investment sector in particular. The disagreement stems from the different interests concerning the tax reformation: while the government hopes that the Tax Reformation can increase the state income, the business owners want the Tax Reformation to support their business in general and investment in particular. The discussion on Tax Reformation is therefore essential to the issue of investment in Indonesia. For this reason, the government has to take into account the interests of many parties in issuing tax regulations to ensure the fairness, transparency and neutrality in its efforts to increase the nation’s income.