The government has issued a ministerial regulation on reporting requirements of bank accounts with Rp1 billion balance for tax purposes. The bank accounts subject to the regulation are those held by Indonesians and foreign nationals living in the country.
The regulation applies to financial institutions in banking, insurance industries and other entities in cooperatives sector. As for the capital market and other entities in the commodity futures trading sector, there are no limits to the balance or amount in an account that must be reported.
Earlier, the government had issued a regulation that would allow tax authorities to examine bank accounts with at least Rp200 million. The regulation was met with backlash, particularly from micro, small and medium-sized enterprises. The government has, therefore, revised the limit to Rp1 billion.
Finance Minister Sri Mulyani has confirmed that the revision was made after receiving input from the people, particularly SMEs.
She explained that the government has considered several factors before making the decision. Firstly, based on the data from the Deposit Insurance Agency (LPS), savings accounts at commercial banks with over Rp1 billion represent 64.22 percent of total savings account in Indonesian commercial banks. The number of bank accounts in the category is 496,867 or 0.25 percent of the total number of bank accounts in Indonesia.
Moreover, based on the data collected in the tax amnesty program, in cash and cash equivalents classification, the declared assets in the amount of at least Rp1 billion represent 95.5 percent or Rp1,661 trillion of overall cash and cash equivalents. The number of taxpayers in the category was 291,331.