Archive for November, 2008

Court hears recording on alleged poll fraud

Wednesday, November 26th, 2008
Desy Nurhayati ,
The Jakarta Post , Jakarta
Wed, 11/26/2008 10:44 AM | Headlines

The Constitutional Court on Tuesday heard a recording of a telephone conversation speculating that East Java gubernatorial candidate Soekarwo would be likely to secure a favorable judgment from the court.

The recorded telephone conversation, which allegedly took place between Edy Sucipto, a witness appearing for defeated candidate Khofifah Indar Parawansa, and Nizar Zahro, head of Pesanggrahan village in Bangkalan regency, was played during the hearing on the dispute over the results of the East Java gubernatorial election.

The plaintiffs argued that the conversation clearly revealed fraudulent practices in polling stations in Bangkalan, Sumenep and Sampang regencies in Madura during the second round of the election. The defendants questioned the recording’s authenticity.

The conversation recorded Edy raising doubts over the results of the vote counting in Madura and asking whether there was any conspiracy behind Khofifah’s loss in those regencies. In response, Nizar said ballot papers had been marked in favor of Soekarwo before the election took place.

“Yes. The situation had been set up,” Nizar said in the recorded conversation.

The conversation reportedly took place on Nov. 13, two days after the East Java General Elections Commission counted the votes.

Khofifah and her running mate Mudjiono, nominated by the United Development Party (PPP) and the Indonesian Democratic Party of Struggle (PDI-P) among others, filed a lawsuit in the court over the results of the final tally, which handed victory to Soekarwo and Saifullah Yusuf, who were backed by President Susilo Bambang Yudhoyono’s Democratic Party and the National Mandate Party (PAN).

Defense lawyer Fachmi Bachmid said the court could not accept the recording as evidence because it lacked validity.

“The conversation did not mention how many votes the plaintiffs had lost and in which polling stations the fraud occurred. It was not clear at all,” he told the court, which was packed with supporters of both camps.

Another lawyer for Soekarwo, Todung Mulya Lubis, demanded the court summon an expert to verify the authenticity of the recording.

The controversy heightened when the chief judge of the Constitutional Court, Mahfud MD, was mentioned in the recorded conversation.

Nizar was recording telling Edy that Mahfud, a Sampang native, might intervene in the court verdict to help Soekarwo win because Mahfud had a close relationship with Fuad Amin, a prominent cleric in Madura.

“It would be very ironic if Mahfud MD annuls Soekarwo’s win. I’m sure the court will rule in favor of Soekarwo. If the court orders a recount, it will only be held in minor polling stations (that will not affect the tally),” Nizar said.

In response, Mahfud confirmed that he knew Fuad but denied any connection with Soekarwo and Saifullah.

Presiding judge Maruarar Siahaan adjourned the session until Dec. 2, but it remains unclear whether the verdict will be handed down at the next hearing.

Businesses Applaud New Income Tax Law

Tuesday, November 25th, 2008
Aditya Suharmoko and Alfian
The Jakarta Post/Jakarta
September,8′2008


Businesses have praise the newly endorsed income tax law, saying it will boost the competitiveness of Indonesia’s economy amid tougher global competition;

The house of Representatives endorsed last week the income tax law in a plenary session, with lawmakers boasting it is one of the most business-friendly laws they have ever enacted.

“The (new) income tax law is in line with business people’s aspirations. It will promote a favorable investment climate,” M.X. Hidayat, Chairman of the Indonesian Chamber of Commerce and Industry (Kadin) said last Friday.

In the new law, income tax for corporations will be set at 28 percent flat in 2009, replacing the exiting progressive system which could go up as high as 35 percent. The rate will be further reduced to 25 percent in 2010.

The rate will be reduced a further 50 percent if the company concerned is categorized as a micro enterprise, or a small and medium enterprises (MSME) or is classed as a company earning less that Rp. 50 billion per year.

With a 14 percent rate in 2009 falling to 12.5 percent in 2010, MSMEs are expected to grow further.

“The 25 percent income tax (for corporations) will make Indonesia relatively competitive compared to the income tax level in other ASEAN countries-Singapore 19 percent, Thailand 25 percent, Vietnam 24 percent, Malaysia 25 percent,” Hidayat said.

While tax rate cuts in 2009 will cause some falls in revenue, overall tax revenue will increase, as it is anticipated that more taxpayers will be tax compliant, he said.

The government has estimated it may lose Rp. 40 trillion (US$4.26 billion) in tax revenue next year due to new tax cuts.

However, government expects to collect Rp. 728.3 trillion in tax revenue next year, in the proposed 2009 state budget, up by 19.2 percent from Rp. 641 trillion expected this year.

“There is nothing negative in the (new) tax law, “Hidayat said, adding that Russia’s state revenue grew by 400 percent after the country cut corporate income tax from 40 percent to 15 percent.

Investment Coordinating Board (BKPM) chairman M. Lutfi said the new tax law would help attract investors to Indonesia.

Lutfi said many local investor had previously invested in Indonesia through foreign companies to avoid high income tax.

House of Representatives member Dradjad H. Wibowo said the law would support all kinds of businesses while at the same time being “stiff on any violations”.

The new law will also support companies that list at least 40 percent of their shares in the Indonesia Stock Exchange. They will get their tax rate cut by a further 5 percent.

The central bank will start paying income tax of 30 percent next year and 28 percent in 2010, but only if it has a budget surplus.

Individual taxpayers will also be pleased that the taxable income threshold for them has been raised firm Rp. 13.2 to Rp. 15.84 million per year in a bid to help ease the burden of low-income families, who spend nearly 70 percent of their income on food, while food prices are increasing.

The House and the directorate general of taxation have also agreed to improve the income tax rates for individuals. The rates did vary from 5 percent to 35 percent and this ceiling is now being reduced to 30 percent.

To tap more taxpayers, the directorate general of taxation will phase out the Rp. 1 million exit tax starting 2009 for registered taxpayers. The exit tax will be eliminated by 2010.


Income Tax rates for Individuals

Existing              Change

=============================================================

Annual Income          Rate                     Annual Income                   Rate

Up to Rp. 25m            5 percent               Up to Rp 50m                      5 percent

——————————————————————————————–

RP 25m -  Rp 50m    10 percent              Rp. 50m - Rp250m              15 percent

——————————————————————————————–

RP 50m -  Rp100m   15 percent              Rp.250m - Rp 500m            25 percent

———————————————————————————————

RP 100m -Rp 200m   25 percent             Above Rp. 500m                 30 percent

———————————————————————————————

Above Rp 200m         35 percent

==============================================================

Other significant changes:

*) Income tax for corporations will be set at 28 percent flat in 009 and 25 percent for 2010

*) The rate will be reduced a further 50 percent if the company concernedcopncerned is

categorized as a micro enterprise, or a small and medium enterprises (MSME) or is

classed  as company earning less than Rp 50 billion per year

*) Dividend payments will be reduced from 20 percent ti a maximum of 10 percent

*) Inheritance tax will be eliminated

*) Exit tax will be eliminated for registered taxpayers in 2009 and for all citizens in 2010

Source : Income tax law