politic

The Government Is Perceived As Lacking Transparency Regarding Tax Matters, Leading To Skepticism Among Indonesian Citizens

The Central Information Commission (CIC) has expressed criticism regarding the government's plan to increase the value-added tax (VAT) to 12% in 2024, citing a lack of transparency in disclosing how the tax revenues collected from the public will be utilized. Rospita Vici Paulyn, the Commissioner for Research and Documentation at the CIC, noted that while the government does announce the realization of the state budget (APBN) on a monthly basis, the information provided is often too general and fails to specify how much of the collected tax revenue is allocated for public benefit.

"The absence of transparency fosters skepticism among the public, leading to diminished trust in the taxes collected by the government," Rospita stated during a discussion at the KIP Central Office in Jakarta on Monday, November 25, 2024.

Rospita emphasized that according to the Information Disclosure Law, 90% of the information held by public bodies must be made accessible by all state institutions, allowing citizens to understand the government's actions and their benefits. Only 10% of information may be withheld, pertaining to state secrets, business confidentiality, and personal privacy.

"Therefore, all financial reports, policies, utilization of goods and services, and any information derived from the state budget should be open to the public. It is up to the citizens to utilize, request, and monitor this information," she remarked.

Rospita provided an example of developed countries, such as Sweden and Belgium, where tax rates are high, yet citizens benefit significantly. Healthcare and education are provided free of charge, resulting in well-maintained roads and robust infrastructure that the community enjoys.

This indicates that citizens perceive the value of their tax contributions when they see those funds being reinvested directly into their communities, she explained.

Without clear information regarding the utilization of tax revenues, it is inevitable that the public will harbor negative sentiments towards the government concerning tax increases, as the benefits are not directly experienced by the populace.

She pointed to the tax sector, citing the case of Gayus Tambunan, who, despite not being a high-ranking official, was able to engage in significant corruption. It is implausible that he acted alone; there must have been accomplices involved, yet this has never been transparently disclosed to the public, which poses a significant issue.

Consequently, she urged the government to postpone the VAT increase to 12% until it can adequately explain the specific benefits to the public, especially considering that Indonesia's VAT is the highest in ASEAN, while neighboring countries with more advanced economies, such as Singapore and Malaysia, have rates of only 7% and 6%, respectively.

Tag: Central Information Commission