Bali Expat Forum - Bali Travel Forum

One of the problems in Indonesia is that they don't increment their price rises. The fiscal tax has been 1 juta for a long time - at least the last 10 years. What they should do (if they are to have it at all) is increment rises to keep the tax in line with inflation, but they don't.
So just like fuel price rises, when they make an adjustment to bring the tax back into line with what it used to be worth in real terms, it is an enormous jump and takes everyone by surprise.

Just a comment on 'rich' Indonesians and travel overseas. MANY have that very convenient stamp in their passport that you are only supposed to get if you live overseas, which exempts you from paying fiscal tax. You can come and go 4 times a year without paying fiscal. They are the ones with connections in overseas consulates that can 'help' them.
It is people like some of my in-laws that I feel sorry for - they go away to Malaysia to work, and with what it costs them to get there, plus their keep, they work like navvies and come back with hardly anything to show for it. But as one said to me when I asked why he bothered - it's better than doing nothing, no jobs here. I would say that with a 2.5 Juta fiscal, he would not break even now.

Hi Freo

Even with the stamp they still have a Fiscal Tax to pay, which is equivelant of what a tourist pays when leaving. Currently I believe RP250,000.

ashbuey wrote:Hi Freo

Even with the stamp they still have a Fiscal Tax to pay, which is equivelant of what a tourist pays when leaving. Currently I believe RP250,000.

That's not a Fiskal tax, it's airport departure tax, as paid in most countries (often included in the ticket price charged though)

In DPS it's Rp150.000 per person, in JKT it's Rp100.000. Compared to airport taxes in much of the world it's pretty cheap.

my indonesian wife, in aussie on a temp/spouse visa reported to indo embassy here when she arrived. She has the stamp and doesnt pay fiscal tax when visiting home. Certainly worth the visit to the consulate actualy, they were very helpful and made Endang feel welcome. No people in high places helping us, just part of their service.

goldminer wrote:my indonesian wife, in aussie on a temp/spouse visa reported to indo embassy here when she arrived. She has the stamp and doesnt pay fiscal tax when visiting home. Certainly worth the visit to the consulate actualy, they were very helpful and made Endang feel welcome. No people in high places helping us, just part of their service.

Yes, my husband has one too, and the Perth Consulate are very helpful. He is entitled to one, as is your wife, because they are not living in Indonesia and have resident or temp resident visas in another country. The people I'm talking about don't live outside of Indonesia, but still have the stamp. Then again, a few I've met in Perth also have dual passports (Indoensian and Australian), so avoid fiscal that way.

matsaleh wrote:

lumumba wrote:From Jakarta Post

The Tax Office will exempt citizens under 21 years of age, foreign nationals who have lived in Indonesia less than 183 days within 12 months, diplomatic officials and staff of international organizations

For the Social Visa I’m not too sure.

Sosial Budaya is valid for a maximum 180 days only. After that time the visa holder must leave the country, so Fiskal or Exit Tax Fee should not be applicable.

Mats, I wonder what will happen to those on a soc. bud. who leave after 180 days but get another in Singapore and come straight back. They will live in Indonesia more than 183 days within 12 months (or do they mean consequtive days??).

All

Please find below:

Unregistered taxpayers to pay double for exit tax
Aditya Suharmoko , The Jakarta Post, Jakarta Fri, 12/26/2008 9:20 AM

The tax office has officially announced an increase in the much-decried fiskal, or exit tax for travelers going overseas, in part to put to rest widespread speculation over the amount of the increase.
The exit tax for those aged 21 years and above departing from airports will be raised from Rp 1 million (US$91) to Rp 2.5 million, and for those traveling by sea from Rp 500,000 to Rp 1 million, effective Jan. 1, 2009, to Dec. 31, 2010.

However, registered taxpayers will not have to pay a single cent; and starting from 2011, the exit tax will be scrapped altogether, according to the Finance Ministry’s directorate general of taxation.

Director general Darmin Nasution said the increase in exit tax was part of an effort to get more potential taxpayers to register for a tax number (NPWP).

It is proving a smart ruse, with many middle-to-high-income residents flocking to nearby tax offices to get an NPWP to comply with the office’s Sunset Policy program that ends on Dec. 31.
The program, under which applicants’ tax obligations in previous years are written off, has seen people rushing to register themselves.

This month alone, the number of people registering for an NPWP was between 50,000 and 100,000 per day, up from about 7,000 people daily in previous months.

The exit tax will from now on become an up-front payment for income tax.

For instance, an employee whose income tax is Rp 20 million per year and who has traveled abroad twice this year — paying Rp 1 million in exit tax each time — will only have to pay Rp 18 million in income tax when filing their tax returns in March 2009.

For those not yet registered, the new exit tax of Rp 2.5 million could prove very daunting.
Satria Ramadhan, who will go to Bangkok for holidays in early January, said he was glad to have registered for an NPWP.

“Otherwise, I would have to pay Rp 2.5 million. I would have definitely canceled my trip if I had to pay such a huge amount.”

Another traveler, Frederick Tobing, praised the move by the directorate general of taxation.
“It’s a smart move. Most people, including myself, will rush to register at the tax office, just to avoid paying the exit tax.”

The directorate general of taxation estimates up to 10 million new taxpayers have registered this year, Darmin said.
“I didn’t expect the number to be this huge. No one expected to tap 10 million new taxpayers,” he said.

To get exemption from paying the exit tax, registered taxpayers must submit a copy of their NPWP, passport and boarding pass to tax officials at airports or ports.


If the NPWP is declared valid, the officials will put a “free exit tax” sticker on the boarding pass. If it is not valid, travelers will have to pay the exit tax.
1. Exit tax from airports for people aged 21 years and above raised from Rp 1 million
to Rp 2.5 million.
2. Exit tax from ports for people aged 21 years and above raised from Rp 500,000
to Rp 1 million.
3. Those automatically exempt from paying the exit tax include: People aged less than
21 years; foreigners staying in Indonesia no more than 183 days within the last 12 months; diplomats; employees of international organizations; Indonesian citizens with official
documents from other countries, including students; Haj pilgrims and Indonesian migrant laborers.
4. Those exempt from paying the exit tax but required to provide documentary proof: Foreign students with letters of recommendation from their universities; foreign researchers; foreign workers in Batam, Bintan and Karimun; disabled or ill people seeking medical treatment abroad paid for by social organizations; people traveling for art, culture, sport and religious missions, and students in a student-exchange program.

I hope this clears the question.

I hope this clears the question.

Umm..isn't that exactly what we've been discussing?

None of that means that it's either equitable or fair or really going to make a difference beyond making it tougher for those who can least afford it to travel.

And what is causing the rise in NPWP registration is not the exit tax rise, but the Sunset Policy, which is quite a different thing (and very, very widely publicised here in Indo). The two are not really related.

FreoGirl wrote:

matsaleh wrote:Sosial Budaya is valid for a maximum 180 days only. After that time the visa holder must leave the country, so Fiskal or Exit Tax Fee should not be applicable.

Mats, I wonder what will happen to those on a soc. bud. who leave after 180 days but get another in Singapore and come straight back. They will live in Indonesia more than 183 days within 12 months (or do they mean consequtive days??).

Good point Freo, I hadn't considered the rules in those terms. I assumed, "more than 183 [consecutive] days within the last 12 months". I guess I'll know definitively after my next trip to Singapore.

And what is causing the rise in NPWP registration is not the exit tax rise, but the Sunset Policy, which is quite a different thing (and very, very widely publicised here in Indo). The two are not really related.

Not really. The "Sunset Policy" is primarily aimed to collect tax from those who already pay it. Under that, you can revise your previous tax declarations until 2007, pay a bit more, and you will not be bothered by the tax authorities for your tax until 2007. There have been similar policies in the past (and surely, there will be in the future as well).
What's happening with the fiscal is a first time thing, and that is aimed to get more tax payers. And I believe, this time, in a very efficient way.

The fall in airfares has made it vastly more affordable for low income workers to travel. You can get to Kl for Rp200.000 on Air Asia. The new Fiskal level pushes that back into the realm of unattainable again and punishes those who were now seeing travel at least vaguely affordable and really does nothing to affect those for whom travel has always been affordable.

Those poor Indonesians who earn IDR 630.000/month and want to benefit the low AirAsia airfares, are free to apply for an NPWP and then they will not be obliged to pay the fiscal.

Those poor Indonesians who earn IDR 630.000/month and want to benefit the low AirAsia airfares, are free to apply for an NPWP and then they will not be obliged to pay the fiscal.

It's not that simple.

A friend of ours registered for a NPWP a month back. He earns about RP900.000 a month. Within 10 days a guy from the tax dept was hassling his employer for paperwork on that and asking for money to go away.

His employer let him go as a result.

What's happening with the fiscal is a first time thing, and that is aimed to get more tax payers. And I believe, this time, in a very efficient way.

The Sunset policy is far bigger and far more widely advertised than any of the previous programs and registration for NPWP is very much a core part of it. Surely you've seen the advertising and the media?

I seriously don't think millions of Indonesians would register for tax just so they could travel internationally and I don't think the government believes that for a moment either.

The tax system is in serious need to reform and anything that widens the base is to be applauded IMO, which is why the Australian tax dept has been putting into place new systems and Indonesia is about to see major change there. However anyone who thinks that the Fiskal exit tax only exists for that reason is fooling themselves.

The bigger issue though is what happens to the taxes. Certainty little of the money raised in Bali from tax in any form (including that raised from tourism) comes back to Bali, with the larger infrastructure projects all being targeted at Java as the funds are stripped from the island. Why would someone in Bali feel inclined to pay tax?

And you need to question why Jet fighters are being bought at the cost of hundreds of millions of dollars (as they just were) when the aircraft the military has in service already are un-flyable and schools are crying out for money.

So I was wondering, with a big drive toward getting employees to register for tax, what has been put in place for business to then collect and pay that tax? It is no small thing administering that side of tax collection. Apart from the risk of fraud, even honest businesses have to take on an additional administrative burden. What is in place to support all of that? I assume the answer is 'nothing'.

Hi Matsaleh,
good luck for your visa run to Singapore. I m also not shure when I read the article in Bali Discovery Newsletter:

http://www.balidiscovery.com/messages/m ... sp?Id=4964 :

Code: Select all

• Concerns that immigration officials will begin counting the number of days "in country" during the past 12 months and require payment of the Rp. 2.5 million fiscal tax for anyone having spent more than 183 days in Indonesia in the past year.


Does the Immigration start to count again, starting with "zero" when I m back from my visa trip? Or will Immigration count also the days before? If yes, its very easy to get the 183 days and you have to pay the fiscal.
BTW, is it possible to get a Tax number when I m living here with socialvisa? But even if its possible - is it a got idea? I don't think so. Don' give your identity to any tax office if they dont ask

Werner

Wepro

The Tax laws in Indonesia have been in existence for some time but rarely enforced. There is a tax even on sosial Budaya holders if they exceed 183 days per year although I doubt if it has been enforced.

Have a look on the site http://www.expat.or.id and do a search on tax. This will give you information on tax registration also.

Hey SG,
Uninformed and controllable? That sounds like the US citizenry!
In the US it's not just unfair taxes, it's also an extremely biased media and outright theft (Wall Street) of the fruits of our labors, theft it seems that will never be aggressively rectified.
The poor, blinded by a biased media and losing their livelihoods have been locked away inside homes that no longer have enough value to sell. The middle-class are stuck well, in the middle, paying off a 1.2 trillion dollar a year debt. The rich are largely unaffected, as usual. The US has much in common with Indonesia, mostly we share the same defining parameters of uninformed and controllable.
Perhaps Jakarta has their sights set on all of those rich globe trotting, non-citizens you mention, who acquire goods inexpensively, export and do a 200% or 300% mark up of cheaply acquired products, once they've reached their destinations. With such a big fat juicy carrot on the end of a stick to chase, to hell and be damned with the poor and middle class. Who gives a s#@t about the economic collateral damage caused by greed?
Geez, I wonder if the United States is even a blip on any Human Rights organizations radar screens yet?
I also think it's humorous, the purchasing of Russian jet fighters. Who the hell is going to fly those things and who will do the basic maintenance? The mechanics from Adam Air?

Don

Anybody know the answer to this?

Westerner married for many years to an Indonesian woman. She has no official job being a wife. Earns no taxable income. Can she get a tax number and exemption from this stupid fiskal fee when she goes for a holiday, say to Singapore?

We asked a high ranking official at the Immigration Office in Denpasar the same question just last week. She didn't have a clue. Couldn't even tell us where the local taxation office is located! I might have been imagining this but I thought I saw her cash-register eyes flicker a bit.

A different view of the taxation system, patricularly those who feel persecuted......


Tax System explained in beer.

Suppose that every day, ten men go out for beer and the bill for all ten comes to $100.

If they paid their bill the way we pay our taxes, it would go something like this:

The first four men (the poorest) would pay nothing.
The fifth would pay $1.
The sixth would pay $3.
The seventh would pay $7.
The eighth would pay $12.
The ninth would pay $18.
The tenth man (the richest) would pay $59.

So, that's what they decided to do.

The ten men drank in the bar every day and seemed quite happy with the arrangement, until one day, the owner threw them a curve.

"Since you are all such good customers," he said, "I'm going to reduce the cost of your daily beer by $20." Drinks for the ten now cost just $80.

The group still wanted to pay their bill the way we pay our taxes.
So the first four men were unaffected.
They would still drink for free. But what about the other six men? The paying customers?

How could they divide the $20 windfall so that everyone would get his fair share?'

They realized that $20 divided by six is $3.33. But if they subtracted that from everybody's share, then the fifth man and the sixth man would each end up being paid to drink his beer.

So, the bar owner suggested that it would be fair to reduce each man's bill by roughly the same amount, and he proceeded to work out the amounts each should pay.

And so the fifth man, like the first four, now paid nothing (100% savings)
The sixth now paid $2 instead of $3 (33% savings).
The seventh now pay $5 instead of $7 (28% savings).
The eighth now paid $9 instead of $12 (25% savings).
The ninth now paid $14 instead of $18 ( 22% savings).
The tenth now paid $49 instead of $59 (16% savings).

Each of the six was better off than before. And the first four continued to drink for free.
But once outside the restaurant, the men began to compare their savings.

"I only got a dollar out of the $ 20,"declared the sixth man.
He pointed to the tenth man," but he got $10!"

"Yeah, that's right," exclaimed the fifth man. "I only saved a Dollar, too.
It's unfair that he got ten times more than I!"

"That's true!!" shouted the seventh man. "Why should he get $10 back when I got only two? The wealthy get all the breaks!"

"Wait a minute," yelled the first four men in unison. "We didn't get anything at all. The system exploits the poor!"

The nine men surrounded the tenth and beat him up.

The next night the tenth man didn't show up for drinks, so the nine sat down and had beers without him.
But when it came time to pay the bill, they discovered something important. They didn't have enough money between all of them for even half of the bill!

And that, boys and girls, is how our tax system works.

The people who pay the highest taxes get the most benefit from a tax reduction.

Tax them too much, attack them for being wealthy, and they just may not show up anymore.
In fact, they might start drinking overseas where the atmosphere is somewhat friendlier.



For those who understand, no explanation is needed.

For those who do not understand, no explanation is possible