December 19, 2019 / 9:20 AM / 2 months ago

Indonesia's Pertamina agrees to share financial data with tax office real time

JAKARTA, Dec 19 (Reuters) - Indonesian state oil and gas company Pertamina on Thursday agreed to share financial transactions in real time with the tax office through an information technology system, which could improve compliance, officials said.

Indonesia has been trying for years to improve its tax collection to fund government programmes. However, despite a relatively successful tax amnesty in 2016-2017, Indonesia’s tax to GDP ratio is still among the lowest in Asia Pacific.

Pertamina is one of Indonesia’s biggest taxpayers and it contributed around 120 trillion rupiah ($8.5 billion) to state coffers in 2018 in tax and dividend payments, chief executive Nicke Widyawati said in a news conference after the signing of the agreement.

Pertamina and the tax office have developed an IT system that could map out all of the firm’s transactions for tax purposes, which would then be shared with the tax office, the first of its kind in the Southeast Asian country, she said.

For Pertamina, the cooperation will cut compliance cost and reduce the opportunity for corruption, while the government could benefit from a smaller cost of collection, Widyawati said.

Tax chief Suryo Utomo urged more state companies to follow Pertamina’s example and share financial information directly with authorities.

This year, slowing economic growth and shrinking exports have further hit the government’s revenue, pressuring the budget deficit.

$1 = 14,080.0000 rupiah Reporting by Wilda Asmarini; Writing by Gayatri Suroyo; Editing by Mark Potter

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