JAKARTA. Ministry of Finance has set a strategic plan (Renstra) in 2020-2024, which is contained in the Minister of Finance regulation (PMK) number 77/PMK. 01/2020. There are several targets that the government wants to achieve through the 2020-2024 strategic plan, firstly increasing the tax ratio, maintaining the government debt ratio and maintaining the budget deficit.
A number of good measures related to tax, excise and economic activities will be taken by the Government to improve the tax ratio. Some of them include doing tax intensification and extensifation, increasing access to third party data including data on the results of the Automatic Exchange of Information (AEoI) program, improving tax regulations and implementing tax amnesty in 2016-2017.
The policies in the field of customs and excise that will be carried out include compiling the tariff policy and expansion of object pf excisable goods and strengthening the function of supervision and transfer of excisable goods.
While the effort to encourage an increase in tax ratio through improved economic activities will be done by increasing the people's purchasing power, the investment climate and competitiveness of national industries. This will be achieved through various taxation policies such as the synchronization of rules in the field of taxation, the provision of incentives in the form of Income Tax (PPh) and import duties borne by the government, and increasing the utilization of Bonded Logistics Center (PLB).
In addition, the government will also encourage industrial downstreaming by providing both fiscal and non-fiscal incentives. This downstreaming activity aims to increase added value and meet the needs of raw materials for the domestic industry.
The efforts to increase the tax ratio are very important, considering that in recent years the government has always failed to achieve the targets set either in the 2015-2019 National Medium Term Development Plan (RPJMN) or as stated in the State Budget (APBN). (see table)
Tax Ratio Achievement in Recent Years
The government sees that there are several factors that cause the tax ratio target can not be achieved. First, macro factors such as tax rates, per capita income levels and the level of optimizing good governance. As well as micro factors which consist of taxpayer compliance, inter-agency coordination and frequent dispute between taxpayers and tax officials.