Indonesia wants more tax from mining

International Tax Review is part of Legal Benchmarking Limited, 1-2 Paris Garden, London, SE1 8ND

Copyright © Legal Benchmarking Limited and its affiliated companies 2025

Accessibility | Terms of Use | Privacy Policy | Modern Slavery Statement

Indonesia wants more tax from mining

fotoflexer-photoindonesianflag.jpg

The mining industry is one of four the Indonesia’s Directorate General of Taxation will be targeting in 2013 in a bid to collect more tax. The authorities also want to improve the ability of officers to detect tax avoidance and boost compliance.

Official data shows that slow global economic growth and a reduction in demand for minerals, which contributed to lower prices and profits, led to a fall in tax receipts from the sector last year.

The government’s tax revenue target for 2013 is Rp1,031.8 trillion ($107 billion). Last year it aimed to collect Rp879.4 trillion but only brought in Rp831.3 trillion.

“The booming sectors are manufacturing, mining, plantations and financial services,” said Fuad Rahmani taxation director general, during a press conference in Jakarta this week. “We also plan to reevaluate construction and property, as well as the transportation sector, to optimise potential tax income from those sources,” he added.

Rahmani and his staff will also try to increase Indonesia’s corporate tax base during 2013, the Jakarta Post reported.

Only 500,000 businesses are registered as taxpayers, official data shows, though there are believed to be an estimated 22 million potential businesses in Indonesia.

“So far, we have not been able to properly conduct a significant tax-base extension. This means that there is still a lot of room for our tax income to grow,” Fuad said.

The director general added that staff needed to increase their skills to deal with tax avoidance.

“We need to improve our officers’ capacities. They need to take more initiatives and be creative. Taxpayers have become more and more sophisticated in avoiding taxes, therefore, our officers need to improve as well,” he said.

more across site & shared bottom lb ros

More from across our site

ITR spoke to two US TP experts about the long-running dispute, with one arguing that the case highlights ‘weaknesses’ with the comparable uncontrolled transaction method
The new practice, which features former ‘big four’ experience, already has over 20 team members
Speakers from companies including Uber and Stripe told the inaugural AI in Tax Forum to brace for impending changes to how advisers work
Authors from Khaitan & Co dissect a ‘welcome’ ruling, which found that the mere existence of a tax benefit would not, by itself, warrant a principal purpose test
Over two-thirds of survey respondents back the continuation of the UK’s digital services tax, research commissioned by the Fair Tax Foundation also found
Given the US/G7 pillar two deal, the OECD is in danger of being replaced by the UN as the leading global tax reform forum
Cinven’s latest investment follows its acquisition of a stake in Grant Thornton UK in December; in other news, a barrister listed by HMRC as a tax avoidance promoter has alleged harassment
CIT base narrowing measures remain more prevalent than increased CIT rates, the report also highlighted
ITR's parent company, LBG, will acquire The Lawyer, a leading news, intelligence and data-driven insight provider for the legal industry, from Centaur Media
KPMG UK’s Graeme Webster and KPMG Meijburg & Co’s Eduard Sporken outline the 20-year evolution of MAPAs, with DEMPE analyses becoming more prevalent and MAPA requirements growing stricter
Gift this article