Indonesia set to dangle tax amnesty before rich citizens

Indonesian lawmakers are expected to pass a new tax amnesty aimed at encouraging wealthy citizens with billions of dollars in assets abroad to come clean with the taxman.

The Bill is likely to be pushed through with little resistance in Parliament in the weeks ahead, given that the Golkar party – the chief proponent of the legislation – has recently left the opposition and declared its support for the ruling coalition.

Unlike a previous scheme introduced in 2008 aimed at undeclared onshore assets and which maintained an errant taxpayer’s liability for the principal sum of taxes, the new law under the Joko Widodo presidency will cover both onshore and offshore assets. It will also offer legal amnesty for repentant tax evaders as well as a variety of discounted tax rates.