Tax litigation in Indonesia: overview

A Q&A guide to civil and criminal tax litigation in Indonesia.

This Q&A provides a high level overview of the key practical issues in civil and criminal tax litigation, including: pre-court/pre-tribunal process, trial process, documentary evidence, witness evidence, expert evidence, closing the case in civil and criminal trials, decision, judgment or order, costs, appeals, and recent developments and proposals for reform.

To compare answers across multiple jurisdictions, visit the Tax Litigation: Country Q&A tool.

The Q&A is part of the global guide to tax litigation. For a full list of jurisdictional Q&As visit www.practicallaw.com/taxlitigation-guide.

Contents

Overview of tax litigation

Issues subject to tax litigation

1. What are the most common issues subject to tax litigation in your jurisdiction?

Indonesia adopts a civil law system. The tax court is located in Jakarta and was established in 2002. The tax court is a branch of the administrative court, although it is separate from the administrative court. In the administrative court, the subject in dispute is a decision issued by the state (through state officials) that is final and individual (that is, specific to a certain legal entity or a person).

Tax disputes are generally under the jurisdiction of the tax court. However, if the case has any indication of crime, the case will be transferred to the criminal court. In addition, there are disputes that must be brought to the administrative court instead of the tax court, such as:

  • Objections to an asset revaluation.

  • Objections to a merger being filed with a book value.

  • Objections to being registered as a taxable entrepreneur.

  • Objections to the regulations or policy of the tax office or the Directorate General of Tax.

For the purpose of this chapter, all references to ''civil tax'' and ''civil trials'' refer to non-criminal tax cases.

Legislative framework

2. Outline the legislative framework and principal pieces of legislation governing both civil and criminal tax litigation.

Civil tax litigation

Indonesia does not recognise civil tax litigation and therefore does not differentiate between civil and criminal tax litigation. In Indonesia, there are two jurisdictions that can handle tax disputes:

All tax disputes are under the jurisdiction of the tax court. However, if there is strong indication of criminal wrongdoings, the case will be transferred to the criminal court (district court). The principal pieces of legislation governing tax litigation are:

  • Law No. 14 of 2002 on Tax Court.

  • Law No. 16 of 2009 on General Provision of Tax (and all its implementing regulations).

Criminal tax litigation

The principal pieces of legislation governing criminal tax litigation are the:

  • Law No. 16 of 2009 on General Provision of Tax (and all its implementing regulations).

  • Indonesian Criminal Procedural Code (Kitab Undang-Undang Hukum Acara Pidana) and all its implementing regulations.

See also above, Civil tax litigation

Tax evasion and other criminal tax offences

3. What are the key elements that constitute tax evasion and other main criminal tax offences in your jurisdiction?

The key elements that constitute tax evasion and other main criminal tax offences in Indonesia are as follows (Articles 38, 39 and 39A, 41A, 41B and 41C, Law No. 16 of 2009 on General Provision of Tax):

  • Negligently failing to file a Letter of Notification (Surat Pemberitahuan) (SPT), or submitting a Letter of Notification where the content is incorrect or incomplete, or attaching wrong information that causes loss to the state, where this is not the first offence. A person found guilty of any of these as a second or subsequent offence will be fined, at a minimum, the amount of the tax payable, and at a maximum, two times the amount of the tax payable. The taxpayer can also be subject to imprisonment of between three months to up to one year.

  • Intentionally committing any of the following acts:

    • failing to register for a taxpayer registration number (Nomor Pokok Wajib Pajak) (NPWP) or failing to report a business to be registered as taxable entrepreneur (Pengusaha Kena Pajak) (PKP);

    • misusing, or using without a right to use, a NPWP or PKP;

    • failing to submit a SPT;

    • submitting a SPT with information that is incorrect or incomplete;

    • refusing to be examined by the Directorate General of Tax;

    • providing books, accounts or other documents that are fake, forged or do not depict the actual condition;

    • failing to maintain, pay attention to or provide books, records and other documents (including documents which form the basis of books or records and other documents, such as data results that are managed electronically or from online application programmes in Indonesia);

    • failing to pay taxes, or paying a proportion of them that causes loss to the state.

  • Intentionally issuing and/or using a tax invoice, proof of withholding tax, proof of payment of tax that is not based on an actual transaction or issuing a tax invoice when a person is not yet registered as a taxable entrepreneur.

  • Intentionally failing to provide a statement or evidence or providing a false statement or evidence.

  • Intentionally obstructing criminal tax investigations.

  • Intentionally not fulfilling tax obligations.

A person found guilty of misusing, or using without a right to use, a NPWP and PKP, or submitting a SPT with incorrect or incomplete information in order to obtain restitution or a tax compensation or tax credit, can be imprisoned for between six months and two years, and fined between two and four times the amount of restitution, tax compensation or tax credit claimed. For the other offences mentioned above, the guilty party can be imprisoned for between six months and six years, and fined between two and four times the amount of tax payable. If a taxpayer has committed a criminal tax offence in the past year, these sanctions can be doubled (and any term of imprisonment imposed will be counted from the time the taxpayer completes their initial term imprisonment, if one was imposed for the previous offence).

 

Pre-court/pre-tribunal process

Assessment, re-assessments and administrative determinations in civil law

4. Outline the procedure for tax assessments, re-assessments and administrative determinations in civil law.

The tax revenue authority in Indonesia is the Directorate General of Tax (DGT) of the Ministry of Finance. The DGT can issue a letter of tax payable (Surat Tagihan Pajak) (STP) at any time if:

  • Income tax in the current year is not paid or underpaid.

  • There is an underpayment of tax because of a typographical error or miscalculation.

  • The taxpayer is given an administrative sanction (fine or interest).

  • The taxpayer does not submit, or is late in submitting, a tax invoice.

  • The tax invoice is missing information.

  • The tax invoice period is not consistent with the date of issue.

  • The taxpayer is not currently trading (in business) but has been given a restitution of incoming VAT.

In addition, the DGT can conduct an assessment (pemeriksaan) of taxpayers to check for tax compliance (Law No. 16 of 2009 on General Provision of Tax) and following the assessment, it can issue any of the following letters (Surat Ketetapan Pajak):

  • Letter of tax underpayment (Surat Ketetapan Pajak Kurang Bayar).

  • Letter of additional tax underpayment (Surat Ketetapan Pajak Kurang Bayar Tambahan).

  • Letter of tax nil (Surat Ketetapan Pajak Nihil).

  • Letter of tax overpayment (Surat Ketetapan Pajak Lebih Bayar).

In response to the above letters, the taxpayer can submit an objection (Keberatan) to the DGT, after which the DGT will issue a decision letter of objection (Surat Keputusan Keberatan). If the issue cannot be resolved with the DGT, it will be brought before the tax court.

Resolving disputes before commencing court proceedings

5. What are the main procedures used to resolve disputes before commencing proceedings in a civil court/tribunal?

Before commencing court proceedings in a tax court/tribunal, the taxpayer can submit an objection to the Directorate General of Tax (DGT) within three months of the date of issue of the assessment letter (see Question 4).

The objection must:

  • Be submitted in writing and in Bahasa Indonesia.

  • State the reason for filing an objection.

  • Only be submitted if the taxpayer has paid the amount of tax agreed in the DGT's assessment letter (see Question 4).

  • Be signed by the taxpayer or its attorney with a power of attorney.

One decision letter of objection will be provided by the DGT for each objection submitted to the DGT.

The decision letter of objection must be issued within 12 months from the date of receipt of the objection. If no decision is made, the objection is automatically deemed approved by the DGT. If the objection is rejected by the DGT, any underpayment is subject to a surcharge of 50%. However, the underpayment and surcharge are not payable if the taxpayer files an appeal to the tax court.

There are no other alternative dispute resolution procedures under Indonesian law.

Elements of the offence in criminal law

6. What are the elements of the main criminal law offences in tax litigation?

Early resolution

7. What are the main procedures used for the early resolution of criminal law offences before trial?

If the Directorate General of Tax (DGT) finds any indication of a criminal act during its assessment, it will examine the case to check for any initial evidence (bukti permulaan) before commencing a criminal tax investigation.

Law No. 16 of 2009 on General Provision of Tax does not contain any procedures to resolve criminal law offences before trial. However, it encourages the taxpayer to settle the issue with the DGT before the case is transferred to the investigator.

 

Trial process

Format of the hearing/trial

8. What format does the hearing/trial take?

Hearings are held in public, and the judgment must also be read in public (Articles 50, 83, 93, Law No. 14 of 2002 on Tax Court). The parties can be present during the hearing but the hearing will still take place even if a party fails to attend, provided that he has been duly notified. If the judge orders any of the parties to attend, that party must attend.

Role of the judge/arbitrator/tribunal members

9. What is the role of the judge/arbitrator/tribunal members in both civil and criminal tax litigation?

Civil tax litigation

The judge in the tax court must examine the case and deliberate the decision. The judge can actively order the attendance of the appellant, claimant or defendant or any witness deemed necessary to give their statement in court.

Criminal tax litigation

In the criminal court, the judge has an active role (that is, he can question the parties in order to find out the truth).

Commencement of proceedings: civil law

10. What is the procedure for commencing tax litigation proceedings in civil law and/or a taxpayer appealing a decision of the tax authority?

Appealing a decision of the tax authority

If the taxpayer is not satisfied with the decision letter of objection of the Directorate General of Tax (DGT), he can submit a letter of appeal to the tax court, which must:

  • Be written in Bahasa Indonesia.

  • Be submitted within three months of the decision letter of objection.

  • Clearly state reasons for appeal.

  • Be accompanied by a copy of the decision letter of objection.

Commencing tax litigation proceedings

Tax litigation proceedings can be commenced by submitting a letter of lawsuit to the tax court for:

  • The execution of a distress warrant (Pelaksanaan Surat Paksa).

  • An order for seizure or auction announcement.

  • A decision relating to the execution of tax decisions other than those contained in Articles 25(1) and 26 of the General Provision of Tax.

  • A decision of correction (Article 16, General Provision of Tax).

  • A decision regarding a letter of tax payable (Article 36, General Provision of Tax).

An action for the execution of distress warrant must be submitted within 14 days of the distress warrant being granted. An action on the other matters must be submitted within 30 days of the decision letter of objection from the DGT.

The time limit for commencing proceedings is:

  • Within six months of the date the letter of lawsuit is submitted to and accepted by the tax court.

  • Within 12 months from the date the letter of appeal is submitted to and accepted by the tax court.

However, in special cases this time limit can be extended up to a maximum of three months (Article 81, Law No. 14 of 2002).

The regulations do not contain any information about fees payable for hearings at the tax court.

 
11. Must a taxpayer pay the disputed tax before leave to appeal the tax authority's decision is granted?

Appeals can only be made if the taxpayer has paid 50% of the disputed tax payable (Article 36(4), Law No. 14 of 2002 on Tax Court). However, the remaining 50% of the disputed tax payable at the time of submitting the application for an appeal does not become payable until the appeal decision is issued (Article 27(5c), Law No. 16 of 2009 on General Provision of Tax).

If the taxpayer loses the appeal, he must pay the entire amount of outstanding tax and an additional 100% fine on the amount of outstanding tax due.

Commencement of proceedings: criminal law

12. What is the procedure for commencing tax litigation proceedings in criminal law?

Tax litigation proceedings in criminal law commence after an investigation (that is, a series of actions by the investigator to find out and collect evidence that connect the criminal activity to the defendant). Only certain state officials in the Directorate General of Tax have the authority to investigate criminal tax.

Once sufficient evidence has been collected, the investigator will report his conclusions to the prosecutor through the police investigator (Indonesian Criminal Procedural Code). The prosecutor then decides whether to commence criminal tax proceedings.

Criminal tax proceedings must be brought within ten years of the time that the relevant tax obligation is owed, such as the end of the tax period, the end of part of the tax period or the end of the tax year (Articles 44A, 44B and 40, Law No. 16 of 2009).

Government response

13. How has the government responded to recent civil and criminal law cases to improve the court procedure?

Civil law

The Minister of Co-ordinating Economy has stated that there will be revisions to the Law of General Provision of Tax and Law of Corporate Income Tax in 2016.

Criminal law

The House of Representatives of the Republic of Indonesia is currently in discussions to revise the Indonesian Criminal Procedural Code of 1981.

Burden of proof

14. What is the burden of proof in both civil and criminal tax litigation proceedings?

Civil law

In each case, the judge will decide what needs to be proven, and who bears the burden of proof. The judge must appraise the evidence, which must include at least two of the following (Articles 69 and 76, Law No. 14 of 2002 on Tax Court):

  • Any written documents or communication.

  • Expert testimony.

  • Witness testimony.

  • Confession of a party to the proceedings.

There is no burden of proof in Indonesia.

Criminal law

In criminal court, the burden of proof lies with the prosecutor, who must prove (Article 191, Criminal Procedural Code):

  • With evidence that the defendant has done the act he is accused of.

  • That the act satisfies all the elements of the offence.

Main stages

15. What are the main stages of typical court proceedings for tax disputes?

Civil law

In order to commence court proceedings in the tax court for tax disputes, the appellant can submit:

  • A letter of appeal (Surat Banding) (for an appeal) together with a letter of explanation of appeal.

  • A letter of lawsuit (Surat Gugatan) (for an initial suit) to the tax court. The defendant must then submit a letter of objection. Once court proceedings have commenced, the judge will explain the matter(s) in dispute to the parties.

The panel of judges will ask the defendant about the matters contained in the appellant's letter of appeal (or the claimant's letter of lawsuit) and the letter of objection. This is followed by an examination of witnesses and evidence, after which the judges will deliberate and render their decision.

An appeal must:

  • Be made in writing in Bahasa Indonesia.

  • Clearly state the reasons why an appeal has been made.

  • State the date of receipt of the decision letter being appealed and be accompanied by a copy of the decision appealed.

In addition, an appeal can only be submitted if at least 50% of the amount of tax payable has been paid.

The letter of lawsuit must:

  • Be made in writing in Bahasa Indonesia.

  • Clearly state the reasons why the lawsuit is submitted.

  • State the date of receipt of the decision subject to the lawsuit and be accompanied by a copy of the decision.

Criminal law

Court proceedings for criminal tax litigation follow the procedural law of the criminal court. This commences with a reading by the prosecutor of the claims, followed by the defendant providing his arguments as to why the prosecutor's claim is not acceptable to be considered by the court (exceptie) At this stage, the exceptie contains arguments not related to the merit of the case. At this point, the judge can issue an injunction that states that the exceptie is accepted, in which case the trial will not continue, or if not, the proceedings will continue with an examination (that is, verification of the evidence) and a reading of the charges. The defendant will submit a defence (pledoi), and the prosecutor will submit a response (replik). The defendant can also submit a response to the prosecutor's response (duplik). The judge will then deliberate on the evidence and arguments of the parties, and then read the decision to the court.

 

Documentary evidence

Disclosure of documents in civil proceedings

16. What documents must the parties disclose to the other parties and/or the court in civil proceedings? Are there any detailed rules governing this procedure?

In tax proceedings, any documents that relate to the dispute can be presented to the court as evidence, including:

  • Written documents or correspondence.

  • Expert testimony.

  • Witness testimony.

  • The confession of a party to the proceedings.

  • Information known by the judge.

The judge can use his own knowledge and expertise to appraise the evidence presented before him.

It is not necessary for the parties to disclose to the opposing party or to the court any type of evidence that they intend to introduce to the court before proceedings commence.

Special rules/considerations

17. Are there any special rules or considerations concerning the disclosure or discovery of documents in civil tax litigation?

In tax proceedings, where a person providing evidence has a confidentiality obligation to another party (either as a result of his work or his position), this obligation will not be taken into account by the court, and the taxpayer can breach this duty of confidentiality for the purposes of providing evidence for the proceedings (Article 59, Law No. 14 of 2002 on Tax Court).

Disclosure in criminal proceedings

18. What documents must the parties disclose to the other parties and/or the court in criminal proceedings? Are there any detailed rules governing this procedure?

In criminal proceedings, documents that relate to the dispute can be presented to the court as evidence (Article 184(1), Indonesian Procedural Criminal Code), including the following:

  • Witness testimony.

  • Expert testimony.

  • Written documents or correspondence.

  • Signs, lead or indications derived from testimonies or letters (actions, events or situations, in which due to the circumstances together evidence the criminal action and the offender) (Articles 184(1) and 188, Indonesian Procedural Criminal Code).

  • Defendant's testimony.

It is not necessary for the parties to disclose to the opposing party or to the court any type of evidence that they intend to introduce to the court before proceedings commence.

Special rules/considerations

19. Are there any special rules or considerations concerning the disclosure of documents in criminal tax litigation?

There are certain laws and regulations that will exempt a person from a duty of confidentiality where that person is providing evidence for the proceedings.

 

Witness evidence

Trial considerations

20. Do witnesses of fact give oral evidence or do they just submit written evidence? Is there a right to cross-examine witnesses of fact?

Civil law

The judge can order witnesses to be present and provide their testimony orally during a hearing (Article 55, Law No. 14 of 2002 on Tax Court). Cross-examination of witnesses is undertaken by the judge. Parties who want to ask questions of the witness must first address them to the judge, who will determine whether they are relevant enough to be asked. It is not necessary for the parties to provide written witness statements from witnesses of fact before the trial.

Criminal law

Oral witness testimony in criminal trials is what is regarded as valid evidence in court (Article 185(1), Indonesian Criminal Procedural Code (Criminal Code)).

Before trial commences, witnesses can be examined and a written report can be created from the examination.

This report can be read in front of the court in the following circumstances (Article 162, Criminal Code):

  • If the witness is deceased.

  • If the witness is not able to attend court due to valid reason.

  • If the witness is not called because he lives too far away.

  • State interest.

Witnesses can be cross-examined.

Witness preparation

21. Provide a brief outline of the procedure for preparing witnesses in both civil and criminal cases. Are there any special or unique features to consider for witness evidence in criminal cases?

Civil law

A witness statement must relate to the witness's own experience, as seen and heard by the witness (Article 73, Law No. 14 of 2002 on Tax Court). The witness must be sworn in before giving testimony in court. Unless deemed necessary by the judge, the following are excluded from being a witness:

  • Direct family (up to the third degree) of any of the parties in dispute.

  • The current or former wife, or current or former husband, of the claimant or the appellant.

  • Children below 17 years of age.

  • People suffering from memory loss.

If the witness is unable to be present in court for a legally valid reason, the panel of judges can attend his residence in order to hear the testimony.

There are no rules on preparing witnesses in Indonesian law.

Criminal law

There are no rules on preparing witnesses in Indonesian law. However, the witnesses must:

  • Be under oath when giving their statements (Article 160 (3), Indonesian Criminal Procedural Code (Criminal Code)).

  • Not leave the courtroom and attend the hearing after giving their statements (Article 167, Criminal Code).

  • Not converse with other witnesses during trial (Article 167(3), Criminal Code).

Witnesses have the right to:

  • Be summoned lawfully with valid reason (Article 112(1), Criminal Code).

  • Be examined in their residence if they can give valid reasons for not being present (Article 113, Criminal Code).

  • Give a statement without duress (Article 117(1), Criminal Code).

  • Refuse to sign the examination report containing their statements (Article 118, Criminal Code).

  • Not to be questioned unreasonably (Article 166, Criminal Code).

  • Be provided a translator (Articles 177(1) and 178(1), Criminal Code).

Where a person is under a duty of confidentiality (either as a result of their profession, dignity, rank or position), they can request to be released from the obligation to provide testimony as a witness about the matters entrusted to them. However, there are also certain regulations which can compel a person to disclose confidential information for the purposes of the court proceedings (for example, in the banking industry).

Hearsay evidence in civil and criminal trials

22. Are there any rules concerning the introduction of hearsay evidence in civil and criminal trials?

Civil trials

Hearsay evidence is not admissible in tax trials (see Question 21, Civil law).

Criminal trials

Hearsay evidence is not admissible in criminal trials.

 

Expert evidence

Expert reports in civil trials

23. What are the rules concerning the introduction of expert reports in civil trials?

Experts can submit their testimony in verbal or written form.

Expert evidence in civil trials

24. What are the rules concerning the introduction of expert evidence in civil trials?

Expert testimony is opinion given by the expert under oath in court about what he knows according to his experience and knowledge (Article 71(1), Law No. 14 of 2002 on Tax Court). A person who is excluded as a witness cannot give expert testimony.

The judge can appoint one or more experts on his own volition or on the request of any or both of the parties. Expert testimony can be given verbally or in writing.

Expert evidence in criminal trials

25. What are the rules concerning the introduction of expert evidence in criminal trials? Is it possible to introduce expert reports?

Expert evidence

Expert testimony is testimony given by an expert who has special skills about the subject matter. Expert testimony is limited to what the expert states orally during the hearing (Article 186, Indonesian Criminal Procedural Code).

Expert reports

If the expert submits a report, it will be considered as another type of evidence (rather than expert testimony presented openly to the court during the proceedings). A letter from an expert must be formally requested by the court (Article 187(c), Indonesian Criminal Procedural Code).

Special considerations

26. Are there any special considerations for introducing expert evidence/reports in both civil and criminal trials?

Civil trials

See Questions 23 and 24. There are no further special considerations for introducing expert evidence/reports in tax court trials.

Criminal trials

See Question 25. There are no further special considerations for introducing expert evidence/reports in criminal trials.

 

Closing the case in civil trials

27. What are the rules governing the submission of both written and oral argument in closing a civil trial?

There is no concept of closing arguments under Indonesian law.

 

Closing the case in criminal trials

28. What are the rules governing the submission of both written and oral argument in closing a criminal trial?

There is no concept of closing arguments under Indonesian law.

 

Decision, judgment or order

Civil law cases

29. What are the rules governing the issuance of a decision in civil cases?

The decision in the tax court must be (Article 77, Law No. 14 of 2002 on Tax Court):

  • Rendered in writing.

  • Read.

  • Based on the examination of evidence, relevant taxation laws and regulations, and the judges' conviction.

If the decision is made by a panel of judges, it must be rendered by unanimous deliberation or a majority vote. Any dissenting opinion must be written in the decision.

In addition, the decision must contain the (Article 84(1), Law No. 14 of 2002 on Tax Court):

  • Heading of the justice and Almighty God (Demi Keadilan Berdasarkan Ketuhanan Yang Maha Esa).

  • Full name, residence and/or other identities of the appellant or claimant.

  • Full name, residence and/or other identities of the respondent or defendant.

  • Date of receipt of appeal or suit.

  • Summary of the appeal or suit, the summary of the appeal explanation letter or suit and the summary of the explanation letter or objection letter.

  • Consideration and a valuation of all evidences presented during the examination of the dispute.

  • Subject of the dispute.

  • Legal reasoning of the decision.

  • Sentence.

  • Date and name of the judges who give the decision, court registrar's name, and a statement of the parties' presence or absence at court.

Criminal law cases

30. What are the rules governing the issuance of a decision in criminal cases?

A decision in criminal cases must be written, read, and contain (Article 197(1),Indonesian Criminal Procedural Code ):

  • A heading of the justice and Almighty God (Demi Keadilan Berdasarkan Ketuhanan Yang Maha Esa).

  • The full name, place of birth, age or date of birth, gender, nationality, residence, religion and occupation of the defendant.

  • The charge(s) against the defendant.

  • A summary of the facts and the evidence relied on by the judges in making their decision.

  • The Articles of law and regulations which form the basis of the decision, including any incriminatory and non-incriminatory conditions.

  • The date of the decision.

  • The name of the prosecutor, judges and registrar.

  • A statement of fulfilment of all elements of the charge.

  • The costs of the proceeding.

  • Information about false statements and the penalties.

  • An order to detain the defendant, if charged.

There is no time requirement/deadline to render a decision.

 

Costs

31. How is the issue of costs determined in both civil and criminal cases?

Civil law

There are no regulations on how costs are determined in tax court cases. There is no cost award. The decision will usually contain the amount of tax payable owed to the state or what the state must return to the taxpayer.

Criminal law

A person who is convicted in a criminal case must bear the costs of the proceedings (Article 222 ,Indonesian Criminal Procedural Code ). The costs of proceedings in cases where the defendant is acquitted are borne by the state.

In practice, the cost of proceedings is usually between IDR500 and IDR10,000. However, there may be other costs related to the proceeding, such as the costs of presenting experts or witnesses.

The accused can make an application to be exempted from bearing the costs of proceedings. If this application is successful, the costs will be borne by the state.

 

Appeals

Right to appeal in civil law

32. What are the main grounds for appealing a civil law decision?

The decision of the tax court decision is final. The only way to appeal is by judicial review, which can be made against points of law or against findings of fact.

A tax court decision can be appealed by judicial review (Peninjauan Kembali) on any of the following grounds (Articles 77(3) and 91, Law No. 14 of 2002 on Tax Court):

  • The decision is based on false or deceiving evidence of the other party.

  • New written evidence (important and decisive) has been found, which is likely to impact the decision made.

  • The decision was beyond the scope of the remedy claimed.

  • Any part of the claim was not decided and the reasons were not considered.

  • The decision conflicts with the prevailing laws and regulations.

Procedure to appeal in civil law

33. What is the procedure for appealing a civil law decision?

The procedural law for appealing a civil law decision by judicial review is based on Law No. 14 of 2002 on Tax Court (Law No. 14/2002) and Law No. 14 of 1985 on Supreme Court. Permission to appeal is not required.

The appeal must be filed with the Supreme Court within three months after the (Article 93, Law No. 14/2002):

  • Forged or deceiving evidence was found by any party.

  • New evidence is found (the date of finding the new evidence must be stated under oath).

  • Original decision of the court was delivered.

The judicial review decision must be rendered within:

  • Six months after the application for judicial review is accepted, if the tax court did a normal procedural examination.

  • One month after the application for judicial review is accepted, if the tax court did a quick procedural examination.

The cost of judicial review proceedings is IDR2.5 million (Decision of Head of Supreme Court No. KMA/79/SK/IX/200).

Right to appeal in criminal law

34. What are the main grounds for appealing a criminal law decision?

The defendant or the public prosecutor can appeal a decision of first instance.

However, where the defendant was acquitted and freed from all charges as a result of either the inappropriate implementation of the law, or a procedural irregularity, the public prosecutor cannot appeal that decision.

The Indonesian Criminal Procedural Code is silent on grounds of appeal but in practice an appeal can be made on points of law, such as negligence in implementation of the procedural law, a mistake or incomplete conclusions.

Procedure to appeal in criminal law

35. What is the procedure for appealing a criminal law decision?

An appeal of a criminal law decision can only be accepted by the registrar of the district court within seven days of either (Article 233, Indonesian Criminal Procedural Code):

  • The decision being rendered.

  • The defendant being notified of the decision (if he was not present).

 

Recent civil law developments and proposals for reform

36. Outline the main recent civil law developments in tax litigation in your jurisdiction. Are there any proposals to reform civil law tax litigation?

The Minister of Co-ordinating Economy has stated that there will be revisions to the Law of General Provision of Tax and Law of Corporate Income Tax in 2016.

 

Recent criminal law developments and proposals for reform

37. Outline the main recent criminal law developments in tax litigation in your jurisdiction. Are there any proposals to reform criminal law tax litigation?

The House of Representative of the Republic of Indonesia is currently in discussions to revise the Indonesian Criminal Procedural Code of 1981.

 

Online resources

Secretariat of the Tax Court, General Secretary of the Ministry of Finance, Republic of Indonesia

W www.setpp.depkeu.go.id/

Description This is the official website of the Secretariat of the Tax Court. It is up-to-date and officially in Bahasa Indonesia.

Directorate General of Tax

W www.pajak.go.id/

Description This is the official website of the Directorate General of Tax. It is up-to-date and officially in Bahasa Indonesia.



Contributor profiles

Freddy Karyadi, Partner

Ali Budiardjo, Nugroho, Reksodiputro

T +62 21 250 5125
F +62 21 250 5001
E fkaryadi@abnrlaw.com
W www.abnrlaw.com

Professional qualifications. Indonesia, Solicitor; Law, University of Indonesia, 1998; LLM in International Tax, Leiden University, 2002

Areas of practice. Capital markets; M&A; investment; property; natural resources; tax; banking and project finance; private equity; venture capital; tech start-up; mining.

Non-professional qualifications. Economics (Hons.), Trisakti University, Jakarta, 1997; MBA, Peking University, 2015

Recent transactions

  • Advising Keppel Land in the site acquisition in West Jakarta.

  • Representing Wedabay Nickel in its tax dispute at the Indonesian Supreme Court.

  • Representing the founders of Arena Group in the fundraising from CLSA.

  • Advising Sequoia in its investment in GO-JEK.

  • Advising Indonesian publicly-listed coal company PT Resources Alam Indonesia Tbk in respect of its acquisition of PT Khatulistiwa Hidro Energi, which holds a 95% stake in hydro-energy company PT Bias Petrasia Persada.

  • Representing PT Bank Mandiri (Persero) Tbk, an Indonesian publicly-listed bank and the biggest commercial bank in Indonesia, in respect of establishing a joint venture company in multi-finance business, together with other prominent business players in the automotive distribution industry such as PT Tunas Ridean Tbk and PT ASCO Investindo.

Languages. English, Bahasa Indonesia

Professional associations/memberships.

  • PERADI (Indonesian Advocates Association).

  • HKHPM (Indonesian Capital Market Legal Consultants).

  • AAI (Association of Indonesian Advocates).

  • IKPI (Indonesian Tax Consultant Association).

  • IFA (International Fiscal Association).

  • IFAC (International Federation of Accountants).

Publications

  • ICLG, Corporate Tax 2016 Indonesia.

  • Indonesia Tax on Inbound Investment 2016.

  • IBFD Derivatives and Financial Instruments, BEPS Effect in Indonesia.

  • IBFD Asia Pacific Tax Bulletin, Case note Criminal Tax Evasion (the Asian Agri Case).

  • IBFD International Transfer Pricing Journal, Issue of Common Control in Recent Transfer Pricing Cases.

  • European Lawyer Reference Series, Transfer Pricing and Tax Avoidance.

  • International Tax Review, Indonesia Relaxes Tax Holiday Rule and Introduces Debt-to-equity Ratio.

  • International Tax Review, Indonesia to Optimise Tax Revenue and Separate Tax Authority from the Ministry of Finance.

Chaterine Tanuwijaya, Associate

Ali Budiardjo, Nugroho, Reksodiputro

T +62 21 250 5125
F +62 21 250 5001
E ctanuwijaya@abnrlaw.com
W www.abnrlaw.com

Professional qualifications. Law, University of Indonesia, 2013

Areas of practice. Investment; corporate law; acquisitions; tech start-up; aviation; banking and finance; mining.

Non-professional qualifications. Bachelor of Business Administration, State University of New York at Buffalo

Recent transactions

  • Financing and investment in tech start-up companies.

  • Assisting the founders of Arena Group in the fundraising from CLSA.

  • Assisting in acquisition of an Indonesian major mining company.

  • Assisting in leasing of aircraft.

Languages. English, Bahasa Indonesia

Publications.

  • Indonesia Boardroom Diversity Report 2012, Female Footprints in IDX-listed Companies (Centre for Governance, Institutions & Organisations NUS Business School).

  • ICLG, Corporate Tax 2016.

  • IBFD Derivatives and Financial Instruments, BEPS Effect in Indonesia.

  • International Tax Review, Indonesia Relaxes Tax Holiday Rule and Introduces Debt-to-equity Ratio.

  • International Tax Review, Indonesia to Optimise Tax Revenue and Separate Tax Authority from the Ministry of Finance.


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