TAX NEWS - June 2010

Indonesia Tax: National Police to investigate companies suspect of the tax evasion scam

Chairman of the Law Commission at the house of Representatives has added pressure to the National Police force to investigate the companies mentioned by the prime suspect of the tax evasion scam involved in the crime.

Benny K Harman (Democratic Party) said on Tuesday "the companies mentioned by Gayus were clear, they are Mr Ical's (Aburizal bakrie) right?"

The statement came hours after police announced the finding of Rp60 billion from a safety box owned by the prime suspect of the tax evasion scam, Gayus Tambunan, which later grew to Rp74 billion with additional Rp14 billion in gold.

The companies under Bakrie & Brothers linked to the scam are the three coal miners in tax arrears dispute with the Finance Department under ex-minister Sri Mulyani; Kaltim Prima Coal, Bumi Resources, and Arutmin which in 2007 have an estimated total tax arrears of Rp1.5 trillion.

Prior to the announcement of the latest seize yesterday, police source said there was Rp65 billion transfers from the three companies to tax officials to illegally settle tax liabilities below the actual amount. The prime suspect also informed that he suspected another transfer of around US$12 from the Bakrie & Brothers' units beside the first Rp65 billion.

Benny said the law commission had urged the National Police Chief General Bambang HendarsoDanuri, who himself linked to another mining contract scam in South Kalimantan recently, to investigate the Bakrie's units.

Police have only mentioned so far four companies indicated with tax evasion; PT Surya Alam Tunggal (prawn packing firm), Excelcomindo (telecommunication firm), Dowell Anadrill Schlumberger, and Indocement.

While interrogation reportedly revealed over 140 companies linked to the evasion which include multinational firms like Thiess, Chevron, and Ford Motor Indonesia.