Sri Mulyani: No Use Splitting Balance in a Number of Banks

Indonesia’s Finance Minister Sri Mulyani Indrawati speaks to reporters.

Jakarta, 16 Ramadan 1438/11 June 2017 (MINA) – Finance Minister Sri Mulyani Indrawati hopes that depositors would not put their money in a number of banks in an attempt to hide assets from tax collectors.

The minister said seeking to hide data by splitting balance in a number of accounts in different banks would not help in the era of automatic exchange of data for tax investigation.

“I want to call on you all if you love the country be compliant (to tax obligation),” Antara News quoted Sri Mulyani as saying in a news conference here on Friday.

She said some people might be worried with the new era and tried to make it difficult for the financial agents to monitor their banking data such as by putting money in a number of banks.

“However, it would be useless as the tax authorities always have ways of tracking all data of tax payers, even if you put your money in a number of banks,” she said.

Sri Mulyani said the era of openness in information is a momentum for improving taxation system that tax payers are aware of their obligation and more compliant in paying taxes.

“We are not seeking to bully the people and are not thinking negatively. We only try to comply with the constitutional duty. If you have not paid we remind you to pay you tax obligation,” she said.

There would no safe place for tax evasion

At the same occasion, Taxation Director General Ken Dwijugiasteadi said tax officers have ways of finding out if tax payers unnecessarily split their deposits in different accounts.

“For example you divide Rp1 billion and put them in different banks , bank A, bank B, bank C, bank D and bank E each Rp200 million we could always easily to track the owner if the names and addresses are the same,” he said.

The government has issued a regulation in lieu of law (Perppu) No 1 of 2017 on Access of Financial Information for Tax Investigation.

The regulation is needed as Indonesia will face an era of transparency in financial information and adopt Automatic Exchange of Information (AEOI) in 2018 when all bank accounts would be accessible to tax investigation. At least 140 countries would adopt AEOI in 2018.

“With the international cooperation under AEOI, there would no safe place for tax evasion,” the minister said earlier.

As a derivation of the Perppu, the Finance Minister will issue a ministerial regulation determining the minimum limit of balance at Rp1 billion obligatory to be reported by financial institutions to the taxation directorate general.

The tax amnesty program from July, 2016 to March 2017 was expected to mark the start of tax reform with greater transparency in taxation system in the country. (T/RS5/RS1)

Mi’raj Islamic News Agency (MINA)