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Tax Reform for Digital Transformation

Jakarta, 08/07/2021 MoF – Tax reform is the government's effort to revive the state budget. During the pandemic, this fiscal instrument worked continuously in a counter cyclical manner amid a decline in tax revenues and an increase in government spending to deal with health and restore the economy.

"The state budget has limiting power, there is sustainability," said the Minister of Finance (Menkeu) Sri Mulyani Indrawati when she was the main speaker at the Tax Reform in The Digital Age Webinar: Challenges and Opportunities organized by the Directorate General of Taxes (DGT), Thursday (08/07).

In the webinar held to commemorate Tax Day 2021, the Minister of Finance explained that tax reform was carried out to deal with digital transformation. The positive side of digital technology is that many community and economic activities utilize and switch from manual to digital.

"With digital technology, all transactions or relationships, both in the economy and even socially, can be recorded, what is called a footprint and that is a plus point for DGT," explained the Minister of Finance.

Indonesia is a country that has global economic relations. All countries protect their taxation rights because current economic transactions are borderless with digital technology.

"Currently the whole world is also carrying out tax reforms and they see each jurisdiction that it is impossible to carry out a global tax regime without coordination, collaboration and cooperation," said the Minister of Finance.

DGT will use this global momentum as well as accelerate tax reform. So that the tax commitment as the foundation of the state can be realized.

“Taxes are the responsibility of the state to its people. In this digital era, digital technology helps us to build and realize a backbone and state responsibility that the public can trust,” concluded the Minister of Finance. (dj/ip/hpy)