Indonesia launches a temporary Voluntary Disclosure Program
On June 28, the Indonesian House of Representatives has approved a Bill on Tax Amnesty. Tax evaders have the opportunity to become tax compliant.
The Bill on Tax Amnesty (RUU tentang Pengampunan Pajak) approved by the Indonesian House of Representatives (Dewan Perwakilan Rakyat, DPR) on June 26, 2016 allows tax evaders to become tax compliant. The program ends by March 31, 2016. Against the background of the Automatic Exchange of Information (AEoI) such a program is of eminent importance.
The participant has to pay a special tax depending on the status of the assets as domestic or foreign and on the application date. If in case of foreign assets a repatriation takes place, a discount will be granted. The rates vary from 2% to 10%. The legal consequence of a participation is a forgiveness of taxes not paid in previous fiscal years.
The Finance Ministry of Indonesia is currently finalizing the ministerial regulations for the implementation of the tax amnesty.