Tax Definition, System and Basic Understanding

15 September 2015

} Dr. Elia
} Wan Juli
} Alfa

May 22, 2008 Page 1 Presentation title

 } Definition
} Tax Law
} Tax Theory
} Types
} System
} Interpretation of Tax Law
} Structure

} Obligatory contribution to the State

} Liability of individual or corporate
} Force
} Based on Laws (Taxation without
Representation is Robbery) >> Ps 23(2) UUD
1945
} Without any direct compensation
} Used for State affairs

May 22, 2008 Page 2 Presentation title

 } Compare and contrast

} Part of Public Law: the relationship between

the people and the elite (State)
} But it has a close relationship with Civil Law
(Hk Perdata) for example status, domicile,
etc. Tax is a binding contract based on law
(Perikatan yang bersumber dari UU).
} It is closely related to the Criminal Law (find
the key word To Enforce
} Tax Law:
Material Law: the tax itself UU PPh and UU PPN
Formal Law: procedures UU KUP

May 22, 2008 Page 3 Presentation title

 } To finance (state budgeting)
} To Regulate (investment, consumption, etc)

Tax Approach
- Economic Approach
- Development approach
- Practical application approach
- Legal approach

} Tax as binding contract

} A set of Rights and Obligations
} Material rule: tax liability has been fulfilled
once the events, transactions (TATBESTAND)
have been occurred.
} Formal rule: tax liability is considered to exist
once the tax collection notice or tax
assessment letter is received

May 22, 2008 Page 4 Presentation title

 } Teori Asuransi: protection to the people
} Teori Kepentingan: Allocation of burden
based on the interest of the people
} Teori Gaya Pikul: Equity (Keadilan)
} Teori Bakti: Major Rights of the State to
collect the tax
} Teori Gaya Beli: Regulatory function. Collect
from people and distribute/allocate

} Subjective tax: depends on the subject

(Income Tax)
} Objective tax: depends on the object (Value
Added Tax (VAT) or General Sales Tax (GST))
} Direct Tax: Collected periodically: Income Tax
} Indirect Tax: Collected depending on the
existence of the events (peristiwa atau
perbuatan hukum): VAT

May 22, 2008 Page 5 Presentation title

 } State Taxes
} Local Taxes

Tax Collection Base

- Domicile Principle >> where the tax payer is
resident
- Source Principle >> source of income
- Nationality Principle >> based on nationality

} Equality
} Certainty
} Convenience of payment
} Economic of collection

May 22, 2008 Page 6 Presentation title

 } Riel stelsel, based on real object or income
} Fictieve stelsel, based on assumptions or
estimation
} Mixed

} Official assessment
} Self-assessment
} Which system is adopted by Indonesia?

May 22, 2008 Page 7 Presentation title

 } Grammatical
} Historical
} Systematic
} Sociological
} Analogy
} Finding of the Law
} A Contratio

} General Provision of Taxes Law UU No 6

tahun 1983 sebagaimana telah diubah
terakhir dengan UU No 16 tahun 2009
} Government Regulation No 74/2011
} Relevant Regulation (Finance Minister
Regulation)

May 22, 2008 Page 8 Presentation title

 } Definition
} Tax ID and registration
} Tax Return
} Tax Assessment
} Revision
} Tax Collection
} Lawsuit
} Objection and Appeal
} Interest Reward
} Bookkeeping
} Tax Audit
} Special Provision
} Reconsideration
} Criminal Provision

} I will email you the law and all regulations,

and for sure the syllabus

May 22, 2008 Page 9 Presentation title