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In Indonesia, the government agency that is responsible for implementing taxation policies in the country is known as the Directorate General of Taxes or Direktorat Jenderal Pajak.
What the Directorate General of Taxes (DGT) Does
Besides implementing the local tax policies, this government agency is also responsible for standardising the technical aspects in the tax field. As an agency that is part of the Ministry of Finance, the DGT is one of the country’s main economic drivers.
The DGT is responsible for staying ahead of the curve. It is also responsible for capturing future opportunities in the digital era that continues to expand and grow. As such, the agency needs to utilise solutions to help transform its IT infrastructure, platforms, and systems in Indonesia. This helps to drive businesses and provide better e-services to the local taxpayers in the country.
The duties of the Directorate General of Taxes in accordance with the mandate of the Minister of Finance Regulation Number 234 / PMK.01 / 2015. This concerns the Organisation and Work Procedures of the Ministry of Finance, and it is their responsibility to formulate and implement policies and technical standardisation in the field of taxation.
In carrying out these tasks, DGT carries out functions:
- Formulating policies in the field of taxation.
- Implementation of policies in the taxation sector.
- Preparing norms, standards, procedures and criteria in the field of taxation;
- Providing technical guidance and evaluation in the field of taxation; and
- DGT administration implementation.
Apart from being based on Regulation of the Minister of Finance Number 234 / PMK.01 / 2015, in carrying out its duties and functions, the Directorate General of Taxes is also based on Regulation of the Minister of Finance Number 210 / PMK.01 / 2017 and Regulation of the Minister of Finance Number 212 / PMK.01 / 2017.
A Brief History of the Directorate General of Taxes
The government agency first started out as a combination of several taxation units in Indonesia. These units were:
- The Tax Office
- The Bureau of Auction
- The Tax Accountant Office
- The Agricultural Tax Office. This office falls under the jurisdiction of the Directorate of Regional Development Contribution, locally known as IPEDA.
IPEDA was originally part of the Directorate General of Monetary. After the presidential decree No. 12 / 1976 in March 1976, it moved to Directorate General of Tax.
DGT organisation is divided into head office units and operational office units. The head office consists of the Secretariat of the Directorate General, directorates, and positions of reviewers. The operational office unit consists of the Regional Office of the DGT (Kanwil DJP), the Tax Service Office (KPP), the Tax Service, Counselling and Consulting Office (KP2KP), and the Tax Data and Document Processing Centre (PPDDP).
The DGT organisation, with a number of operational offices of more than 500 units and a number of employees of more than 42,000 people spread across the archipelago, is one of the large organisations within the Ministry of Finance. All existing resources are empowered to implement tax revenue security.
More information about the Directorate General of Taxes in Indonesia is available here.