Crazy rich is a popular term that has been used a lot lately to describe super-rich person who often flaunt their wealth on social media. This phenomenon had received a response from the Minister of Finance, Sri Mulyani.
“We feel glad when someone flaunts their bank balance on social media, that way we can have one of our tax officer to engage and comment in the post, something like 'yes, we'll come later’ (to investigate)," she said.
"We can identify those who don't flaunt their wealth on social media, let alone those who flaunt," added Sri Mulyani.
This phenomenon encourages tax officer to be more active in monitoring Taxpayer’s social media so they can ensure that Taxpayer had been complied in paying their tax obligations.
Social media monitoring is one of Directorate General of Taxes (DGT) efforts to maintain public trust that they collect fair taxes. Currently, DGT uses all financial and non-financial institutions to obtain Taxpayer information.
Reported from katadata.com, DGT has a complete sources of information. Beside Tax Amnesty data, Tax Office can also obtain information on Indonesian assets stored abroad, including from tax havens country, through the Automatic Exchange of Information (AEoI) system.
In Law Number 9 of 2017, DGT has given broad access to obtain data or information for tax purposes. Therefore, information on Taxpayer’s asset that collected can be matched with their Income Tax Return (ITR).
Taxes are indeed coercive for every citizen. If someone has met the subjective and objective requirements, they are obliged to pay taxes. If a Taxpayer intentionally do not pay the payable taxes, there will be administrative sanctions or criminal penalties.
New Individual income tax rate is regulated in Harmonization of Tax Regulations Law. Crazy Rich who earn more than IDR5 billion is subject to 35% tax rate. Under previous regulation, income above IDR500 million was subject to a 30% tax rate. Currently, there is a new progressive rate for more than IDR5 billion per year of 35% tax rate (5% increase from the previous rate).
