JAKARTA (Reuters) – Indonesian President Joko Widodo on Monday urged citizens to take part in the country’s new tax amnesty and pledged his government will “go all out” to keep the law behind it from potentially getting blocked in court.
In line with low payment rates in a law passed in June, the government hopes that by March 2017, Indonesians will bring home billions of dollars parked outside the country.
The tax amnesty program was initiated by Widodo’s government to cover a big shortfall in budget revenue and to widen Indonesia’s small tax base. The sooner people declare their assets, the lower rates they will pay.
“We want this tax amnesty to be successful,” the president told a Jakarta audience including business executives on Monday. “I know now many are still doing their calculation, but in time, I believe at the third or fourth week of August, or early September, there will be a lot of inflow.”
At Indonesia’s Constitutional Court, legal activists last month filed a request for judicial review of the law, contending that it protects money launders and tax evaders.
The court, at a preliminary hearing last week, told the applicants to revise their filed request, which it said lacked argument about the constitutional damage from the law. They were given until Aug. 9 to submit a revised request.
Widodo, without elaborating, said the government “will go all out so the Constitutional Court will uphold the tax amnesty law.”
The president said it is important for the amnesty to work.
“We have to realise that when there’s inflow, we will have a big room to develop this nation,” he said.
(Reporting by Hidayat Setiaji and Agustinus Beo Da Costa; Writing by Fransiska Nangoy)