Improving the Indonesian Taxation System using Tax Amnesty's Policy

JON ERIZAL, BAMBANG SUPRIYONO, BAMBANG SANTOSO, TJAHJANULIN DOMAI

Department of Business Administration, Faculty of Administrative Sciences

University of Brawijaya

Veteran Street, Ketawanggede, Lowokwaru Regency, Malang City, East Java 65145

INDONESIA

Abstract: - The purpose of this research is to obtain an overview of the tax amnesty policy in 2016 whether it

has had an impact in solving economic development policy problems in Indonesia. Another objective is to find

out and gain important knowledge that might be missed in any tax amnesty policy discussion. The method used

in this research is descriptive, literature study, and library research. This research uses a qualitative approach.

Data collection techniques using documentation study and interviews. The economic crisis has had a major

impact on tax revenue. The output of the amnesty policy was said to be successful because the achievement of

the value of the declaration exceeded the target. The repatriation target is not successful, not just a matter of

policy implementation, but other supporting policies such as profitable projects or businesses that are not ready

and cannot be realized with shortcuts, because it takes time because they are related to the economic structure

of a country. The originality of this study, when compared to previous studies, is that there are deviations from

the assumptions and theories of policy factor analysis, policy process analysis, and policy impact analysis.

Key-Words: - Economic System, Economic Development, Economic Growth, Fiscal Policy, Tax Amnesty,

Compliance

Received: July 15, 2021. Revised: February 21, 2022. Accepted: March 8, 2022. Published: March 18, 2022.

1 Introduction

Tax Amnesty Volume II has the opportunity to be

reopened as said by the Minister of Finance Sri

Mulyani. Sri Mulyani had given a signal that she

would resume the program because she received

stories from several businessmen who regretted not

taking advantage of the tax amnesty from the state

about three years ago. Member of Commission XI

DPR from the PDIP faction Maruara Sirait agreed to

the tax amnesty program aka Tax Amnesty Volume

II. The rejection of the Tax Amnesty Volume II

discourse is also not insignificant because there are

many risks to be faced. The Central Executive of the

Indonesian Tax Consultants Association (IKPI)

assesses that the tax amnesty program should ideally

be conducted once. If it will be done again, it is

better if the time lag is longer. The government has

been kind enough to provide opportunities for

taxpayers to settle their tax responsibilities with the

state. However, the government could have other

considerations, namely ignoring justice for obedient

taxpayers to attract bigger income.

The implementation of Tax Amnesty in 2016

was strongly supported by various parties because at

that time the situation of tax revenues was still weak

and the Indonesian government had signed an

international agreement on information disclosure.

This form of information disclosure is related to

increasing access to banking data for tax purposes

between partner countries. First, the Foreign

Account Tax Compliance Act (FATCA) was

initiated by the United States. Second, the

Automatic Exchange of Information (AEol) is

carried out simultaneously by the G-20 countries

together with the Organization for Economic Co-

Operation and Development (OECD). The

implementation of AEol will begin in 2018.

Long before the Tax Amnesty policy was rolled

out, [6] has expressed his views in the Analysis of

the Implementation of Tax Amnesty in Indonesia.

According to him, Indonesia had implemented a tax

amnesty in 1984, however, the implementation was

ineffective because taxpayers did not respond less

and it was not followed by a reform of the tax

administration system as a whole. In addition, the

role of the tax sector in the APBN system still

functions as a complement so that the government

does not make more serious efforts. At that time,

much of the state revenue was dominated by the oil

and gas export sector. In contrast to now, tax

revenue is the dominant source of revenue in the

structure of the Indonesian Government's APBN.

In its implementation, according to [6], the

implementation of taxation in Indonesia still has

several problems. First, taxpayer compliance is still

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low. Second, the power of the Directorate General

of Taxes is still too large because it includes

executive, legislative, and judicial functions at the

same time, causing injustice in serving taxpayer

rights which affects lowering the level of taxpayer

compliance. Third, low trust in tax officials and

complicated tax regulations. The application of Tax

Amnesty must be based on a legal umbrella in the

form of law and clarity of terms and objectives. The

provision of a tax amnesty policy should not only

eliminate the right to collect taxpayers (WP) but

more importantly improve the needs of taxpayers so

that in the long term it can increase tax revenue.

The implementation of the Tax Amnesty policy

followed by capital rapture will have an impact on

development in Indonesia through three channels.

First, the funds that enter Indonesia can be used to

drive the economy in the country. Second, the

ransom funds generated by Tax Amnesty can be

used directly for pro-people development such as in

the fields of education, health, housing, and job

creation for workers. Third, in the long run, it will

guarantee sustainable acceptance [7].

According to [9], tax compliance is needed for

efficiency and justice in building social capital.

Therefore, the design of an effective Tax Amnesty

policy to reduce tax avoidance requires an

understanding of the behavioral aspects of tax

compliance. The results of research conducted by

[1] explain that increased tax compliance is

influenced by individual perceptions of a fair

taxation system and that the government provides

goods and services that are commensurate with state

budget tax revenues.

[11] conducted a study on the application of the

Tax Amnesty policy by conducting a systematic

review of several articles discussing Tax Amnesty

policies. The result is that the main motivation for

the implementation of the Tax Amnesty policy by

almost all tax authorities in various countries is to

reduce the budget deficit by providing incentives in

the form of lowering rates and even eliminating

administrative sanctions and criminal charges.

The purpose of this research is to obtain an

overview of the tax amnesty policy in 2016 whether

it has had an impact in solving economic

development policy problems in Indonesia. In this

study, the novelty of research that was not obtained

from previous research is that there are deviations

from the assumptions and theories of policy factor

analysis, policy process analysis, and policy impact

analysis. In addition, this study uses several

variables related to Tax Amnesty Policy, namely

Public Policy, Fiscal Policy, Taxes, Economic

Development, and Economic Growth. The use of

these variables together is very unique and very

rarely used in previous studies, which is the best

quality research in this study in disclosing the theory

of increasing tax compliance in Indonesia.

2 Literature Review

2.1 Public Policy

In simple terms, public policy can be defined as

whatever the government does. Public policy is one

component of the state that should not be ignored. A

state without a public policy is seen as a failure,

because living together is only regulated by a person

or group of people, who work like tyrants, to satisfy

the interests of themselves or groups only [5].

Public policy is a government action to achieve

certain results due to public demands and pressures

of the situation, preceded by decision-making

containing formulas to achieve goals and ways of

overcoming the problem.

The public policy includes the policy process

(policy process) and policy analysis (policy

analysis). The policy process examines the policy-

making process, starting from identifying and

formulating problems, implementing policies,

monitoring policies, and evaluating policies.

Meanwhile, policy analysis includes the application

of analytical methods and techniques that are

multidisciplinary in the policy process.

Public policy analysis is research to obtain data

and information relating to the problems faced

which are followed by finding and studying various

alternative solutions to problems or achieving goals.

The purpose of policy analysis is to provide

policymakers with information that can be used to

solve public problems. Public policy analysis also

aims to improve the quality of policies made by the

government [2].

2.2 Fiscal Policy

Policy, which is often referred to as "fiscal politics"

or "fiscal policy", is usually defined as the actions

taken by the government in the state budget sector

to influence the running of the economy. It is often

said that fiscal policy includes all government

actions in the form of enlarging or reducing the

amount of tax collection. Enlarge or reduce

"government expenditure" and/or reduce

"government transfer" which aims to influence the

running of the economy.

Fiscal policy is carried out by the government to

obtain policy funds pursued by the government to

spend these funds to carry out development. So in

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simple terms, fiscal policy is a government policy

related to state revenue or expenditure. Fiscal policy

is made by the government to direct the economy of

a country through government spending and revenue

in the state budget sector. Fiscal policy refers to

policies made by the government to direct the

economy of a country through government spending

and revenue (in the form of taxes).

The objective of fiscal policy is to influence the

course of the country's economy. The way this is

done is by reducing government consumption

expenditure (G), the number of government

transfers (Tr), and the amount of taxes (Tx) received

by the government so that it can affect the level of

national income (Y) and the level of employment

opportunities (N).

The objective of fiscal policy is to prevent

unemployment and stabilize prices, its

implementation is to move revenue and expenditure

items in the state revenue and expenditure budget

(APBN). With the increasingly complex structure of

the trade and financial economy, the tackling of

inflation will become more complex.

Fiscal policy is a policy in managing state

finances, namely those contained in the state

revenue and expenditure posts in the APBN which

refers to article 3 paragraph (4) of Law no. 17/2003

concerning state finances, budget-related fiscal

policy (APBN) has functions, namely the Authority

Function, the Planning Function, the Supervision

Function, the Allocation Function, the Distribution

Function, and the Stabilization Function. Fiscal

policy has several roles, namely reducing the

inflation rate, increasing gross domestic product

(GDP), reducing the unemployment rate, and

increasing people's income.

2.3 Tax

Tax comes from the Latin taxo, namely people's

contributions to the state based on law, so that they

can be enforced, without receiving direct

remuneration. According to Charles E. McClure, tax

is a financial obligation or levy imposed on

taxpayers (private persons or entities) by the State or

institutions whose function is equivalent to the state

which is used to finance various kinds of public

expenditures. Taxes are collected based on legal

norms to cover the cost of producing collective

goods and services to achieve general welfare.

Refusal to pay, evade, or fight against taxes is

generally a violation of the law.

The definition of tax was put forward by

Andriani in [8]. Stating that: "Taxes are

contributions to the state (which can be imposed)

which are owned by those who are obliged to pay

them according to regulations, without receiving a

direct appointment, and whose use is to finance

general expenses associated with the state's duties

which carry out government."

Taxes are the transfer of wealth from the people

to the State Treasury to finance routine expenses

and the surplus is used for public saving which is

the main source to finance public investment. From

an economist's point of view, a tax is a non-fine

transfer of resources from the private sector to the

public sector that is levied on a predetermined basis

and without stating the benefits to be provided.

Economists believe that not all financial

transfers to the public sector can be categorized as

taxes. For example, some transfers to the public

sector are still influenced by prices. For example,

tuition fees at state universities and fees for

providing services to the government.

Tax from an economic perspective is

understood as the transfer of resources from the

private sector to the public sector. This

understanding illustrates that the existence of taxes

causes two situations to change. First, the reduced

ability of individuals to control resources for control

of goods and services. Second, increasing the state's

financial capacity in the provision of public goods

and services which are a public need.

2.3.1 Tax Function

Money generated from taxation has been used by

states and institutions throughout history to carry

out various functions. Some of these functions

include war financing, law enforcement, security of

assets, economic infrastructure, public works,

subsidies, and the operation of the country itself.

Tax funds are also used to pay state debts and

interest on these debts. The government also uses

tax funds to finance welfare guarantees and public

services. These services include education, health

care, pensions, assistance for the unemployed, and

public transportation. The provision of electricity,

water, and waste management also use a certain

portion of the tax funds. The colonial and modern

period countries have also used to encourage

production to become an economic movement.

2.3.2 Taxes as an Instrument in Fiscal Policy

Understanding of taxes in a review of fiscal policies

can be studied through a simple model that has been

given by John Rose as follows: The economic

activity of a country is described in the Bath Tub

model which has four units/faucet:

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Fig. 1: The tax model as a fiscal policy instrument

Bath Tub Model which has four faucets:

1) Water element: Shows economic activities

and structures consisting of agriculture and

processing of natural resources, livestock,

plantations, and others.

2) Water level: shows the level of economic

activity, the level of employment.

3) Faucet 3: faucet withdrawal of funds

through savings

4) Faucet 4: faucet withdrawal of funds via tax

5) Faucet 5: faucet for investment expenditure

6) Faucet 6: faucets for state expenditure

expenditures

The four faucets are a variable in government

policy in the fiscal sector, which is also called

policy in the real sector. The mechanism of this

bathtub model explains how to regulate the faucet so

that the water is in apposition full employment on

the one hand and the other so that the water

structure that represents the economic situation

makes the economic structure better. Strong

structure, independent economy, even relatively

independent of premier production activities.

2.3.3 Tax Ratio

The tax ratio is the ratio between state revenue from

the tax sector and Gross Domestic Product (GDP).

This ratio is influenced by various factors such as

taxation policies including tax rates, the

effectiveness of tax collection, various incentives

and tax exemptions given to economic actors and

society, and the possibility of tax crimes such as tax

evasion and avoidance. The tax ratio also describes

the level of tax compliance which is influenced by

the education and understanding of taxes from the

community as well as the tax compliance culture

including the law enforcement system.

The tax ratio also reflects the ability of the

government regime to reabsorb GDP to be

translated into tax revenue which in turn is reused

for the benefit of society. Therefore, several

countries have different calculations of this tax ratio

by including, among others, social security and local

taxes. Meanwhile, the components of tax revenue in

Indonesia include central tax revenue, Non-Tax

State Revenue (PNBP) from the Oil and Gas sector,

and PNBP from the General Mining sector. Local

taxes are not a component of calculating the tax

ratio in Indonesia.

2.3.4 Taxation System Reform Policy Tax

Reform is a significant and comprehensive change

in the taxation system which includes reforming tax

administration, improving tax regulations, and

increasing the tax base. The form of implementation

may vary depending on the conditions at hand. This

could be by increasing or decreasing the tax rate,

changing the layer of taxable income, changing the

threshold for taxable income (PKP), changing the

tax base, imposing new taxes and removing old

taxes, changing the composition of tax revenue, or

making fundamental changes. on tax administration

practices and procedures.

The direction of tax reform is the optimization

of the tax system. Where the optimal tax system can

be seen from six indicators, namely: adequate

revenue, fair distribution, minimal excess burden or

overload, must support stability and growth policies,

a fair and less flexible administrative system, and

minimal administrative and compliance costs. . Tax

reform has a broad and evolving meaning.

Williamson in [4] states that tax reform includes

broadening the tax base, improving tax

administration, reducing tax avoidance and

manipulation, and regulating the imposition of

assets located abroad.

2.3.5 Tax Amnesty Policy

Amnesty or tax amnesty is a policy regarding

taxation by providing a limited-time opportunity for

certain groups of taxpayers to pay a certain amount

and within a certain time in the form of amnesty of

tax obligations (including interest and fines) relating

to the previous tax period or a certain period without

fear of criminal penalties.

For many countries, tax amnesty is often used as

a tool to collect state revenue from the tax sector

(tax revenue) quickly in a relatively short period.

This tax amnesty program was implemented

because of the worsening of tax avoidance efforts.

This policy could benefit the acquisition of funds,

especially the return of funds held abroad, and this

policy has a weakness in the long term that can

adversely impact a decline in voluntary compliance

(voluntary compliance) of tax compliance when tax

amnesty is implemented programs right.

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Tax Amnesty is not a policy without

justification. The Indonesian government through

the Directorate General of Taxation has

implemented Tax Amnesty policies in 1964, 1984,

and 2008 (named Sunset Policy). The tax amnesty

policy that has been taken by the government is part

of the ongoing process of tax reform.

2.4 Economic Development

According to [10], development is a process of

improving the quality of human life, so development

must have the aim of improving the lives of the

nation and strengthening the unity and integrity of

the nation. Development is a process of change that

takes place continuously in the direction to be

achieved, which of course is a change from a certain

condition to a better condition. Economic

development is a process of increasing total income

and per capita income by taking into account

population growth and accompanied by fundamental

changes in the economic structure of a country and

income distribution for residents of a country. As an

effort, development is an active action that must be

taken by a country to increase per capita income.

Thus, the participation of the community,

government, and all elements in a country is needed

to actively participate in the development process.

This is done because the increase in per capita

income reflects improvements in people's welfare.

For developing countries, economic

development is intended to improve the standard of

living of its people, so that it is equal to the level of

life in developed countries. However, the reality

shows that since the second world war ended and

many independent countries, but as developing

countries, their living standards are still far behind

until now when compared to developed countries.

This is due to the various problems faced by

developing countries.

There are three basic problems faced by

developing countries. The three basic problems are

the development of income inequality, poverty, and

the widening gap between developed and

developing countries. Indonesia has experienced a

rapid urbanization process (same as the recent

international trend). Since the mid-1990s the

absolute rural population in Indonesia has started to

decline and currently more than half of Indonesia's

total population lives in urban areas (whereas in the

mid-1990s only about a third of Indonesia's

population lived in urban areas). Economic

inequality or inequality in income distribution is a

reality that exists amid society in both developed

and developing countries and is still an important

issue to be overcome. Development can be seen as a

process whose results are multidimensional, which

includes various changes to social structures,

attitudes of society, and institutions of government

and society. In addition to continuing to pursue

accelerated economic growth, addressing income

inequality and poverty alleviation is needed. The

problem of inequality needs to be the main focus in

determining the implemented public policies. The

process of improving the quality of the population's

economic welfare is expected to be followed by an

improvement in the quality of the population as a

whole. One of them can be started by improving the

level of equitable distribution of income among

various economic groups of society. So, the

development must reflect changes in a society or

adjustments of the social system as a whole.

2.5 Economic Growth

Growth is not only a picture of the economy at one

time, but also provides a portrait of economic

development from time to time. In the long term

context, economic growth acts as an indicator that

shows the ability of a country to provide more and

more commodities, goods, and services to its

citizens. This capacity grows along with

technological advances, institutional adjustments,

and the ideology it requires [3] The economic

growth of a nation can be seen from the continuous

increase in the supply of goods. The theory of

economic growth explains what factors determine

the increase in per capita output in the long run, and

how these factors interact with one another, causing

the growth process to occur. [10] proposes three

factors that affect economic growth, namely, capital

accumulation, population and workforce growth,

and technological progress

3 Methodology

This research uses qualitative research methods. The

purpose of choosing a qualitative method in this

study is to explain a phenomenon regarding tax

amnesty as deeply as possible. This is due to the

importance of depth and detail regarding tax

amnesty and how to improve tax compliance in

Indonesia. In qualitative research, if the data

obtained is more in-depth/thorough, it can also be

interpreted that the better the quality of the research.

So in terms of the number of respondents or

research objects, qualitative research methods have

fewer objects than quantitative research, because

they prioritize data depth, not data quantity.

In addition, the method used is descriptive and

collects data related to the tax amnesty policy. This

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research is categorized as a descriptive study

because the approach taken is through a qualitative

approach. Sources of data are obtained from

economic reports, research journals, and interviews

or discussions with several professionals who have

authority and competence in their respective fields.

The data used in this study are primary data and

secondary data. Primary data is data whose source

of acquisition is directly related to the problem by

discussing with people related to the problem under

study. About the tax amnesty policy, the process is

carried out by interviews and discussions with

several figures from the DGT, DPR, BI,

Commercial Banks, OJK, experts/observers on

economics/taxation, and community

leaders/entrepreneurs. Primary data from these

interviews will not dominate in this study but will

complement as a comparison for data analysis.

Meanwhile, secondary data is data obtained from

documentation relating to the object of research. In

the context of tax amnesty policy research, this

documentation is the Annual Economic Report

published by institutions such as DGT, Ministry of

Finance, Bank Indonesia, and BPS. The observed

reporting period was from 2010 to 2015, then the

2016-2017 period report and the last report for the

2018 to 2019 period. The report also obtained

supporting information from several internet sites

and journals that discuss tax amnesty. In research on

tax amnesty policy, secondary data (documentation)

will dominate the data acquisition analysis of

research results.

The data collection technique in this research

was carried out by conducting a documentation

study, namely searching for various economic

reports by downloading from websites belonging to

state institutions. Then conduct interviews with

professional figures from agencies or institutions

related to tax issues and tax amnesty. Qualitative

data analysis begins with data collection. Then

perform data reduction. Data reduction is from the

data obtained, the data collection is carried out in a

complete and detailed description or report.

Furthermore, presenting the data and concluding.

Partial data processing uses HyperResearch to map

answers from informants. HyperResearch is a

software that allows qualitative & quantitative

analysis of textual material, audio graphics, &

video. HyperResearch in this study to perform text

encoding (any length: words, phrases, sentences,

paragraphs, etc.), graphics, audio encoding, and

videotapes.

The variables used in the study are as follows:

X1: Public Policy

X2: Fiscal Policy

X3: Taxes

X4: Economic Development

X5: Economic Growth

Y1: Tax Amnesty Policy

4 Results and Discussion

Based on the results of the analysis of policy driving

factors, analysis of the policy process, and analysis

of the impact of policies, it is found that several

things deviate from assumptions and theories. Some

of these things the researchers view are the findings

of the tax amnesty policy research. Some of the

research findings that the researchers mean are as

follows.

First, when the tax amnesty policy was to be

rolled out, one of the issues on the agenda-setting

was Indonesia's low tax ratio (± 12%) compared to

developed countries (above 25%). Even the lowest

compared to other developing countries in the Asia

Pacific region. The reason being blamed is the low

taxpayer compliance ratio is the main source of the

problem with the low tax ratio. But 3 years after the

tax amnesty, a distorted fact is faced, When the

taxpayer compliance ratio for 2017 to 2019

continues to increase, the tax ratio is surprisingly

low, ranging from 10% - to 11% (Figure 2). This

fact has invalidated the claim of the tax amnesty

policy that the low compliance ratio is the cause of

the low tax ratio, which has led to a decline in tax

revenue growth.

Fig. 2: Post Tax Amnesty Progress

Second, there is the fact that during the 1998

Asian economic crisis and the 2008 global

economic crisis, Indonesia's tax ratio also declined,

then rose again the following year. This fact shows

that Indonesia's tax ratio is very easily influenced by

the international economic situation. This means

that the economic activities of business actors in

Indonesia (as a source of tax revenue) are strongly

influenced by the economic situation from outside

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Indonesia. Even the situation in 2019 was marked

by the China-US trade war, the impact is that global

demand for commodities will decrease. Indonesia as

a commodity-exporting country was affected, and in

the end, the Indonesian economy also weakened. It

is proven that mining's contribution to GDP has

fallen by -19% and tax revenue, as well as the tax

ratio, has suddenly decreased.

Third, the critical note of tax observer Yustinus

Prastowo is the imbalance of property ownership

among taxpayers from the tax amnesty data. The

amount of property owned between community

groups is very striking. It seems that the assets only

accumulate in a handful of people, and there is a

tremendous imbalance because as many as 2.5% of

amnesty participants control 60% of the total assets.

This critical note confirms the World Bank

Executive Summary (November 2015) that there has

been a widening income gap between the richest

10% of the population and the rest of the population,

driven by many types of inequality in Indonesia. It

appears that Indonesia's Gini ratio is getting higher

ahead of the tax amnesty policy.

When comparing the facts of economic

inequality above with the progress of taxpayer

compliance and progress in the tax ratio, efforts to

increase tax growth cannot rely solely on improving

the tax system through reform policies, or based on

suggestions from several observers so that the DGT

is made an autonomous institution so that its

capacity is maximized. So it must go through efforts

to change the pattern of development policies that

promote justice in business opportunities. Thus the

number of business actors will increase rapidly and

there will be additional tax revenue from this sector.

The explanation by the government regarding the

decline in tax revenue in the last 5 years is the

underground economy and informal sector activities

that have not been recorded properly in the taxation

system. The underground economy is income

generated from economic activities, both legal and

illegal, which is missed in the calculation of Gross

Domestic Product (GDP). Underground economic

activities that are allowed to continue to grow will

result in a loss of tax revenue. To overcome this, a

tax amnesty policy was implemented, to reduce lost

tax revenues, but it is not yet known whether this

goal can be achieved or not. This study aims to

measure the size of the underground economy and

lost tax revenues due to the underground economy,

as well as to compare the average lost tax revenues

before and after the tax amnesty.

The theoretical contribution of the results of this

research is expected to add to the scientific findings

in the field of public administration, especially those

related to the implementation of the Tax Amnesty

policy, which includes the following aspects:

1) How are other factors that can actually and

theoretically increase the success of the Tax

Amnesty policy. So far, many Tax Amnesty

policies have been developed and are always

monotonous based on a taxation perspective

and do not show the influence of other

policies such as fiscal policy and public

policy. This study highlights the influence of

these other policies by adding other

influential variables in the Tax Amnesty

policy. This research produces a very special

theory and becomes a "hidden treasure" in

research that is in the context of taxation.

2) This research can be used as a theoretical

study and real research results that are very

useful for the government to examine in more

detail how the policies are taken and the

process in implementing the Tax Amnesty

policy which can later be linked to increased

state revenues.

3) This research can also be used as a reference

in formulating other public policies that will

be affected by the Tax Amnesty policy.

The practical contributions of this research are:

1) The results of this study can be used as a

recommendation for the Government of

Indonesia not to rely solely on financial

factors/microeconomic factors in formulating

Tax Amnesty policies, but also to consider

other factors such as public policies, fiscal

policies, economic growth, and other

variables that have been described in this

study. It is also highly recommended to the

ministry of finance and in particular to the

Directorate General of Taxes so that the

management of taxation and state revenue

from taxes can be carried out more optimally.

2) The results of this study can be used as

recommendations for politicians who sit in

the legislature in responding to the results of

the implementation of Tax Amnesty and then

to make better policies that are useful for the

community.

3) The results of this study can be used as

recommendations for community

organizations and NGOs, especially those

concerned with economic and legal issues in

providing information on tax amnesty and the

factors that can influence it to the community.

4) The results of this study can be used as

recommendations for private parties with an

interest in Tax Amnesty policies, to be more

WSEAS TRANSACTIONS on BUSINESS and ECONOMICS

DOI: 10.37394/23207.2022.19.76

Jon Erizal, Bambang Supriyono,

Bambang Santoso, Tjahjanulin Domai

E-ISSN: 2224-2899

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Volume 19, 2022

obedient in paying taxes and considering their

assets in paying taxes (increasing tax

compliance).

The limitation of this study is:

1) The Tax Amnesty policy discussed is only in

the scope of 2016.

2) Supporting reports used for secondary data

are only limited to certain years (not all are

used).

5 Conclusion

From the analysis of the research results, the results

of the immediate results (output) of the tax amnesty

policy are said to be successful because the

achievement of the value of the declaration has

exceeded the target. The repatriation target is not

successful, not just a matter of policy

implementation, but other supporting policies such

as profitable projects or businesses are not ready.

And it is impossible to do it with a shortcut because

it takes time. After all, it is related to the economic

structure of a country.

The impact (outcome) of the tax amnesty policy

on the tax authority (DGT) has resulted in various

further tax reform policy steps and Indonesia was

able to implement the AEoI financial information

exchange. There is an impact (outcome) of the tax

amnesty policy on the growth of tax revenue.

Although several observations have criticized the

performance achievements in 2019, in 2018 the

realization of the 2018 state revenue managed to

exceed the target set in the State Budget (102.5%).

Contributions to the success have come from

various programs that support the optimization of

tax collection due to the increased tax base after tax

amnesty and increased taxpayer compliance.

The important findings in this study are 1) there

is empirical evidence after tax amnesty, namely that

the compliance ratio does not always increase

followed linearly by an increase in the tax ratio; 2)

In the history of its growth, it turns out that

Indonesia's tax ratio has proven to be very sensitive

in terms of the global economic situation; 3) There

is empirical evidence from the data on the

achievement of tax amnesty, namely the occurrence

of economic inequality that has been reported by

various parties such as the World Bank, OECD, and

other economic observers.

Based on the research results, the following

suggestions are obtained:

1) Suggestions from several parties to repeat

the tax amnesty policy will have difficulty

finding strong arguments. Because the tax

ratio and compliance ratio are not always

linear. So if you want to do it again, it

would be better if you use a tax incentive

pattern.

2) There must be a strong effort to change the

structure of the Indonesian economy not to

be too dependent or easily influenced by the

global situation. It is proven that when some

kind of crisis occurs, the tax ratio of a

country like Indonesia will be affected.

3) It seems that the Inclusive economic

development policy that has been

campaigning so far needs to be reviewed for

accuracy. This is because the policy of

inclusive economic development so far has

not shown any impact on the Indonesian

economy.

References:

[1] Cummings, R. G., Martinez-Vazquez, J.,

McKee, M., & Torgler, B. (2005). Effects of tax

morale on tax compliance: Experimental and

survey evidence (No. 2005-29). CREMA

Working Paper.

[2] Dunn, W. N. (1994). Public Policy Analysis: An

integrated approach. Routledge

[3] Kuznets, S. (1955). Economic growth and

income inequality. The American economic

review, 45(1), 1-28.

[4] Mas' oed, M. (1994). Ilmu hubungan

international: disiplin dan metodologi. Penerbit

PT Pustaka LP3ES.

[5] Nugroho, R. (2009). Public Policy. Kelompok

Gramedia

[6] Ragimun, R. (2011). Analisis Implementasi

Pengampunan Pajak (Tax Amnesty) di

Indonesia. Publikasi Penelitian Terapan dan

Kebijakan, 5(3).

[7] Rasbin. (2016). Tax Amnesty, Potensi Dana

Repatriasi, Dan Pembangunan Di Indonesia.

Majalah Info Singkat Vol. VIII, No.

08/II/P3DI/April/2016. Jakarta

[8] Santoso, B.R. (1998). Pengantar Hukum Pajak.

Bandung: Refika Aditama.

[9] Slemrod, J. (1992). Why people pay taxes: Tax

compliance and enforcement. University of

Michigan Press.

[10] Todaro, M. P. (2000). Migration and

development. Population and Development

Review, 26(3), 611-611.

[11] Widihartanto, S. & Widiatmanti, H. (2016). Tax

Amnesty dan Faktor Penentu Kenerhasilannya;

Pelajaran dari Beberapa Otoritas Pajak. DDTC

Working Paper. No. 1415

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DOI: 10.37394/23207.2022.19.76

Jon Erizal, Bambang Supriyono,

Bambang Santoso, Tjahjanulin Domai

E-ISSN: 2224-2899

883

Volume 19, 2022

Contribution of Individual Authors to the

Creation of a Scientific Article (Ghostwriting

Policy)

JON ERIZAL was responsible for

conceptualization, data curation, formal analysis,

methodology, software, supervision, writing -

original draft, and writing - review & editing.

BAMBANG SUPRIYONO was responsible for

conceptualization, supervision, writing - original

draft, and writing - review & editing.

BAMBANG SANTOSO was responsible for

conceptualization, methodology, supervision,

writing - original draft, and writing - review &

editing.

TJAHJANULIN DOMAI was responsible for

conceptualization, data curation, methodology,

supervision, writing - original draft, and writing -

review & editing.

Sources of Funding for Research Presented

in a Scientific Article or Scientific Article

Itself

No Funding

Creative Commons Attribution License 4.0

(Attribution 4.0 International, CC BY 4.0)

This article is published under the terms of the

Creative Commons Attribution License 4.0

https://creativecommons.org/licenses/by/4.0/deed.en

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WSEAS TRANSACTIONS on BUSINESS and ECONOMICS

DOI: 10.37394/23207.2022.19.76

Jon Erizal, Bambang Supriyono,

Bambang Santoso, Tjahjanulin Domai

E-ISSN: 2224-2899

884

Volume 19, 2022