Taxation

Taxes are people's contributions to the state treasury based on law (so that they can be enforced) without receiving direct remuneration. Taxes are collected based on legal norms in order to cover the cost of producing collective goods and services to achieve general welfare.

So, taxes are the prerogative of the government, mandatory contributions collected by the government from the public (taxpayers) to cover routine state expenditures and development costs without remuneration that can be directly appointed based on law.

There are various limitations or definitions of taxes according to experts, including:

  1. Dr. PJA Adriani = tax is a public contribution to the state (which can be enforced) owed by those who are obliged to pay it according to general regulations (laws) with no return of achievement which can be directly appointed and whose use is to finance general expenses related to state duties to organize the government.
  2. Dr. H. Rochmat Soemitro SH. = tax is the people's contribution to the state treasury based on law (which can be enforced) without receiving direct service that can be shown and used to pay for general expenses.
  3. Sommerfeld Ray M. Anderson Herschel M. & Brock Horace R. = Tax is a transfer of resources from the private sector to the government sector, not as a result of violation of the law, but must be implemented, based on predetermined conditions and without receiving direct and proportional compensation, so that the government can carry out its duties to run the government.
  4. Smeets = Taxes are achievements to the government that are indebted through general norms and can be enforced without any contradictions which can be shown in individual rights to finance government expenditures
  5. Suparman Sumawidjaya = tax is a mandatory contribution in the form of goods collected by the authorities based on legal norms, in order to cover the cost of producing collective goods and services in achieving general welfare.

The five main elements in the tax tax definition are:

  1. Contribution / levies from the people to the state
  2. Taxes are collected by law
  3. Taxes can be enforced
  4. Without lead or counter-achievement
  5. Used to finance state households (general government expenditure)

Tax characteristics contained in the meaning of tax are as follows:

  1. Taxes are collected by the state, both by the central government and by local governments based on laws and implementing regulations.
  2. Tax collection implies the transfer of funds (resources) from the private sector (taxpayers pay taxes) to the state sector (tax collectors / tax administrators).
  3. Tax collection is intended for general government financing purposes in carrying out government functions, both routine and development.
  4. It cannot be shown that there is individual compensation (counter-achievement) by the government for tax payments made by taxpayers.
  5. Functioning as a budgetary or filling the state treasury / state budget needed to cover the financing of government administration, taxes also function as a tool to regulate or implement state policies in the economic and social field (regulatory / regulatory function)

Which regulates the definition of tax disputes ..

On the other hand, Article 25 paragraph (1) of the KUP Law regulates the rights of taxpayers to file objections to tax officials. In this sense, an objection can be filed if there is a tax dispute and Article 25 paragraph (1) of the KUP Law only determines in a limited way the objects that can be filed for a tax dispute.

The definition of tax disputes is only regulated in article 1 point 5 of the Law DILJAKED in the KUP Law. The definition of tax disputes as referred to in article 1 point 5 of the DILJAK Law is as follows "Tax disputes are disputes arising in the field of taxation between taxpayers and tax bearers and authorized officials as a result of the issuance of decisions that can be appealed or sued to the tax court based on taxation laws and regulations, including a lawsuit for the implementation of collection based on the tax collection law by force letter ".

Based on the definition of tax disputes above, it turns out that tax disputes are only focused on appeals and lawsuits under the authority of the tax court. Tax disputes in the form of appeals and lawsuits are only tax disputes in a narrow sense because there are still tax disputes that are not included in it. Meanwhile, tax disputes in a broad sense are disputes that are filed with objections, appeals and challenges to the tax court.

The emergence of a tax dispute

The emergence of tax disputes lies in two very principal matters, namely first, not taking legal actions as ordered by the tax law norms, second, carrying out legal binding, but not in accordance with tax law norms. Furthermore, it is mentioned the parties that cause tax disputes, namely taxpayers, tax collectors, tax collectors, tax collectors and tax officials.

Why is a taxpayer said to be the source of tax disputes because of not taking legal actions as ordered by tax law norms, for example not submitting a notification letter within the specified time period. Meanwhile, in committing a legal act, the legal act is against the norm of tax law, for example paying taxes that are not fully paid and the period for repayment has ended.

Withholding or tax collectors are said to be the source of tax disputes because they do not take legal action as instructed by the tax law, for example not depositing the amount of tax withheld or collected in the state treasury, while in carrying out legal actions, but contrary to legal norms, for example incorrectly applying tariffs. taxes in order to withhold or collect taxes.

The tax bearer is said to be the source of tax disputes because he does not take legal actions as ordered by tax law norms, for example not fulfilling the obligations as stated in the forced letter, while in carrying out legal actions, but contrary to tax law norms, for example obstructing the clerk. tax confiscation during confiscation of goods subject to confiscation.

Tax officials are said to be the source of tax disputes because they do not take legal actions as instructed by tax law norms, for example not issuing tax underpayment assessments to collect the amount of underpaid tax, while taking legal actions but contrary to tax law norms, for example issue a tax collection decision in real time and at the same time to taxpayers who are not entitled to receive it.

Expiration of Tax Segketa

Regarding the expiration time of tax disputes is a study of tax law as positive law. In a sense, other laws (other than tax law) may not involve themselves in assessing when a tax dispute ends, even though tax disputes are actually regulated by other legal instruments contained in tax law, but based on research results it turns out that tax disputes end because of outside settlement. the judicial environment and within the tax court.

The end of tax disputes during the examination through the tax court is not a violation of tax law and is even beneficial from the aspect of tax law enforcement because the purpose of law enforcement is to resolve tax disputes without violating tax law and providing taxpayer legal protection.

Justice system in it

Taxes have an important role in the life of the state, not only functioning as a source of state revenue but also having a function of income distribution. Personal income tax is an instrument to address the inequality of income distribution between high-income and low-income people. Poverty, both relative and absolute, creates several obstacles to improving the welfare of the people of a country. Social inequality among the poorest members of society can cause political and economic instability for the nation as a whole. So that the difficulties experienced by the poorest members of society are ultimately felt by the whole community.

To realize the income distribution function, the personal income tax rate in Indonesia imposes a progressive tax rate where people with high incomes will be subject to a higher tax rate. The imposition of a progressive tax rate is at the same time a manifestation of the carrying capacity theory in which taxes are imposed on the public according to their economic capacity. The current rates of personal income tax in Indonesia are as follows:

  • Income up to IDR 50 million 5%
  • Above IDR 50 million to IDR 250 million 15%
  • Above IDR 250 million to IDR 500 million 25%
  • Above IDR 500 million 30%

Personal income tax rates increase as income increases. The principle underlying progressive taxation is that those with more (wealthier) abilities must bear a greater burden of the total state tax revenue from those who are less fortunate. So individuals with low income not only pay less taxes, but they pay a smaller percentage of their income in the form of taxes. Of the various types of taxes, it is this progressive income tax that is most in line with the goal of increasing income equity.

Tax Dispute Act

The legal basis for tax disputes is as follows:

  • Law no. 14 of 2002 regarding the tax court.
  • Law no. 6 of 1983 concerning general provisions and tax procedures.
  • Law no. 16 of 2000, no 28 of 2007, and related implementing regulations.
  • ARTICLE 1 point 5 UU PP; Tax Disputes are disputes that arise in the field of taxation between a Taxpayer or a Tax Bearer and an authorized official as a result of the issuance of a decision which can be submitted for an appeal or suit to the Tax Court based on taxation laws and regulations, including Lawsuit against the implementation of collection based on the Tax Collection Law with a warrant.
  • ARTICLE 1 point 5 UU PP; Tax Disputes are disputes that arise in the field of taxation between a Taxpayer or a Tax Bearer and an authorized official as a result of the issuance of a decision which can be submitted for an appeal or suit to the Tax Court based on taxation laws and regulations, including Lawsuit against the implementation of collection based on the Tax Collection Law with a warrant.
  • ARTICLE 31 UU PP; The Tax Court has the duty and authority to examine and decide tax disputes. The Tax Court in the case of Appeal only examines and decides disputes on objection decisions, unless otherwise stipulated by the prevailing laws and regulations.

The Tax Court in the event that the Lawsuit examines and decides disputes over the implementation of tax collection or correction decisions or other decisions as referred to in Article 23 paragraph (2) of Law Number 6 of 1983 concerning General Provisions and Tax Procedures as amended several times, most recently by Law -Law Number 16 of 2000, law Number 28 of 2007 and applicable tax laws and regulations.

  • Article 32 PP; In addition to the duties and powers as referred to in Article 31, the Tax Court shall supervise legal counsel who provide legal assistance to disputing parties in Tax Court hearings.

Criminal Sanctions in Tax Law

According to the provisions in the Taxation Law, there are 3 (three) types of known criminal sanctions, namely:

  • Criminal Fines
  • Criminal Cage: V
  • Prison Criminal

Criminal Fines

In contrast to sanctions in the form of administration which are only threatened / imposed on taxpayers who violate the provisions of the taxation regulations, sanctions in the form of criminal fines in addition to being imposed on taxpayers are also imposed on tax officials or on third parties based on the Criminal Code. Criminal fines are imposed on criminal acts that are offensive or criminal in nature. If the criminal fine cannot be paid by the person concerned, then in exchange, he must undergo a prison sentence.

Criminal Cage: V

The punishment of imprisonment is only punishable by a criminal offense. Can be addressed to Taxpayers, Officials, and Third Parties. The sentence of imprisonment which is imposed on the offender is lighter than imprisonment, because the crime was committed accidentally or because of negligence.

Prison Criminal

The principle of imprisonment is the same as imprisonment, which is a punishment for confiscation of a person's body. This type of crime is a crime. The threat of imprisonment can be aimed at taxpayers, taxpayers or third parties

Taxes are people's contributions to the state treasury based on law (so that they can be enforced) without receiving direct remuneration. Taxes are collected based on legal norms in order to cover the cost of producing collective goods and services to achieve general welfare.

So, taxes are the prerogative of the government, mandatory contributions collected by the government from the public (taxpayers) to cover routine state expenditures and development costs without remuneration that can be directly appointed based on law.

There are various limitations or definitions of taxes according to experts, including:

  1. Dr. PJA Adriani = tax is a public contribution to the state (which can be enforced) owed by those who are obliged to pay it according to general regulations (laws) with no return of achievement which can be directly appointed and whose use is to finance general expenses related to state duties to organize the government.
  2. Dr. H. Rochmat Soemitro SH. = tax is the people's contribution to the state treasury based on law (which can be enforced) without receiving direct service that can be shown and used to pay for general expenses.
  3. Sommerfeld Ray M. Anderson Herschel M. & Brock Horace R. = Tax is a transfer of resources from the private sector to the government sector, not as a result of violation of the law, but must be implemented, based on predetermined conditions and without receiving direct and proportional compensation, so that the government can carry out its duties to run the government.
  4. Smeets = Taxes are achievements to the government that are indebted through general norms and can be enforced without any contradictions which can be shown in individual rights to finance government expenditures
  5. Suparman Sumawidjaya = tax is a mandatory contribution in the form of goods collected by the authorities based on legal norms, in order to cover the cost of producing collective goods and services in achieving general welfare.

The five main elements in the tax tax definition are:

  1. Contribution / levies from the people to the state
  2. Taxes are collected by law
  3. Taxes can be enforced
  4. Without lead or counter-achievement
  5. Used to finance state households (general government expenditure)

Tax characteristics contained in the meaning of tax are as follows:

  1. Taxes are collected by the state, both by the central government and by local governments based on laws and implementing regulations.
  2. Tax collection implies the transfer of funds (resources) from the private sector (taxpayers pay taxes) to the state sector (tax collectors / tax administrators).
  3. Tax collection is intended for general government financing purposes in carrying out government functions, both routine and development.
  4. It cannot be shown that there is individual compensation (counter-achievement) by the government for tax payments made by taxpayers.
  5. Functioning as a budgetary or filling the state treasury / state budget needed to cover the financing of government administration, taxes also function as a tool to regulate or implement state policies in the economic and social field (regulatory / regulatory function)

Which regulates the definition of tax disputes ..

On the other hand, Article 25 paragraph (1) of the KUP Law regulates the rights of taxpayers to file objections to tax officials. In this sense, an objection can be filed if there is a tax dispute and Article 25 paragraph (1) of the KUP Law only determines in a limited way the objects that can be filed for a tax dispute.

The definition of tax disputes is only regulated in article 1 point 5 of the Law DILJAKED in the KUP Law. The definition of tax disputes as referred to in article 1 point 5 of the DILJAK Law is as follows "Tax disputes are disputes arising in the field of taxation between taxpayers and tax bearers and authorized officials as a result of the issuance of decisions that can be appealed or sued to the tax court based on taxation laws and regulations, including a lawsuit for the implementation of collection based on the tax collection law by force letter ".

Based on the definition of tax disputes above, it turns out that tax disputes are only focused on appeals and lawsuits under the authority of the tax court. Tax disputes in the form of appeals and lawsuits are only tax disputes in a narrow sense because there are still tax disputes that are not included in it. Meanwhile, tax disputes in a broad sense are disputes that are filed with objections, appeals and challenges to the tax court.

The emergence of a tax dispute

The emergence of tax disputes lies in two very principal matters, namely first, not taking legal actions as ordered by the tax law norms, second, carrying out legal binding, but not in accordance with tax law norms. Furthermore, it is mentioned the parties that cause tax disputes, namely taxpayers, tax collectors, tax collectors, tax collectors and tax officials.

Why is a taxpayer said to be the source of tax disputes because of not taking legal actions as ordered by tax law norms, for example not submitting a notification letter within the specified time period. Meanwhile, in committing a legal act, the legal act is against the norm of tax law, for example paying taxes that are not fully paid and the period for repayment has ended.

Withholding or tax collectors are said to be the source of tax disputes because they do not take legal action as instructed by the tax law, for example not depositing the amount of tax withheld or collected in the state treasury, while in carrying out legal actions, but contrary to legal norms, for example incorrectly applying tariffs. taxes in order to withhold or collect taxes.

The tax bearer is said to be the source of tax disputes because he does not take legal actions as ordered by tax law norms, for example not fulfilling the obligations as stated in the forced letter, while in carrying out legal actions, but contrary to tax law norms, for example obstructing the clerk. tax confiscation during confiscation of goods subject to confiscation.

Tax officials are said to be the source of tax disputes because they do not take legal actions as instructed by tax law norms, for example not issuing tax underpayment assessments to collect the amount of underpaid tax, while taking legal actions but contrary to tax law norms, for example issue a tax collection decision in real time and at the same time to taxpayers who are not entitled to receive it.

Expiration of Tax Segketa

Regarding the expiration time of tax disputes is a study of tax law as positive law. In a sense, other laws (other than tax law) may not involve themselves in assessing when a tax dispute ends, even though tax disputes are actually regulated by other legal instruments contained in tax law, but based on research results it turns out that tax disputes end because of outside settlement. the judicial environment and within the tax court.

The end of tax disputes during the examination through the tax court is not a violation of tax law and is even beneficial from the aspect of tax law enforcement because the purpose of law enforcement is to resolve tax disputes without violating tax law and providing taxpayer legal protection.

Justice system in it

Taxes have an important role in the life of the state, not only functioning as a source of state revenue but also having a function of income distribution. Personal income tax is an instrument to address the inequality of income distribution between high-income and low-income people. Poverty, both relative and absolute, creates several obstacles to improving the welfare of the people of a country. Social inequality among the poorest members of society can cause political and economic instability for the nation as a whole. So that the difficulties experienced by the poorest members of society are ultimately felt by the whole community.

To realize the income distribution function, the personal income tax rate in Indonesia imposes a progressive tax rate where people with high incomes will be subject to a higher tax rate. The imposition of a progressive tax rate is at the same time a manifestation of the carrying capacity theory in which taxes are imposed on the public according to their economic capacity. The current rates of personal income tax in Indonesia are as follows:

  • Income up to IDR 50 million 5%
  • Above IDR 50 million to IDR 250 million 15%
  • Above IDR 250 million to IDR 500 million 25%
  • Above IDR 500 million 30%

Personal income tax rates increase as income increases. The principle underlying progressive taxation is that those with more (wealthier) abilities must bear a greater burden of the total state tax revenue from those who are less fortunate. So individuals with low income not only pay less taxes, but they pay a smaller percentage of their income in the form of taxes. Of the various types of taxes, it is this progressive income tax that is most in line with the goal of increasing income equity.

Tax Dispute Act

The legal basis for tax disputes is as follows:

  • Law no. 14 of 2002 regarding the tax court.
  • Law no. 6 of 1983 concerning general provisions and tax procedures.
  • Law no. 16 of 2000, no 28 of 2007, and related implementing regulations.
  • ARTICLE 1 point 5 UU PP; Tax Disputes are disputes that arise in the field of taxation between a Taxpayer or a Tax Bearer and an authorized official as a result of the issuance of a decision which can be submitted for an appeal or suit to the Tax Court based on taxation laws and regulations, including Lawsuit against the implementation of collection based on the Tax Collection Law with a warrant.
  • ARTICLE 1 point 5 UU PP; Tax Disputes are disputes that arise in the field of taxation between a Taxpayer or a Tax Bearer and an authorized official as a result of the issuance of a decision which can be submitted for an appeal or suit to the Tax Court based on taxation laws and regulations, including Lawsuit against the implementation of collection based on the Tax Collection Law with a warrant.
  • ARTICLE 31 UU PP; The Tax Court has the duty and authority to examine and decide tax disputes. The Tax Court in the case of Appeal only examines and decides disputes on objection decisions, unless otherwise stipulated by the prevailing laws and regulations.

The Tax Court in the event that the Lawsuit examines and decides disputes over the implementation of tax collection or correction decisions or other decisions as referred to in Article 23 paragraph (2) of Law Number 6 of 1983 concerning General Provisions and Tax Procedures as amended several times, most recently by Law -Law Number 16 of 2000, law Number 28 of 2007 and applicable tax laws and regulations.

  • Article 32 PP; In addition to the duties and powers as referred to in Article 31, the Tax Court shall supervise legal counsel who provide legal assistance to disputing parties in Tax Court hearings.

Criminal Sanctions in Tax Law

According to the provisions in the Taxation Law, there are 3 (three) types of known criminal sanctions, namely:

  • Criminal Fines
  • Criminal Cage: V
  • Prison Criminal

Criminal Fines

In contrast to sanctions in the form of administration which are only threatened / imposed on taxpayers who violate the provisions of the taxation regulations, sanctions in the form of criminal fines in addition to being imposed on taxpayers are also imposed on tax officials or on third parties based on the Criminal Code. Criminal fines are imposed on criminal acts that are offensive or criminal in nature. If the criminal fine cannot be paid by the person concerned, then in exchange, he must undergo a prison sentence.

Criminal Cage: V

The punishment of imprisonment is only punishable by a criminal offense. Can be addressed to Taxpayers, Officials, and Third Parties. The sentence of imprisonment which is imposed on the offender is lighter than imprisonment, because the crime was committed accidentally or because of negligence.

Prison Criminal

The principle of imprisonment is the same as imprisonment, which is a punishment for confiscation of a person's body. This type of crime is a crime. The threat of imprisonment can be aimed at taxpayers, taxpayers or third parties