Khairunnisa Rahinaningtyas

16/397035/EK/20991
Assignment #1 - Summary of Chapter II
Types of taxes and the jurisdiction that uses them

Chapter 1 Section 2

There are two types of taxes that is being implemented in Indonesia; Pajak Negara (Central
Government Tax) and Pajak Daerah (Local Tax).

A. Central Government Tax

There are five kinds of central government tax:
1. Income Tax (PPh). It is based on Law Number 7 of 1983.
2. Value Added Tax (PPN & PPn BM). The legal basis is Law No. 8/1983.
3. Stamp Duty (Bea Materai). The legal basis is Law No. 15 of 1985.
4. Land Tax and Building Tax (PBB). The legal basis is Law No. 12 of 1994.
5. Fees for Acquisition of Rights to Lands and Buildings (BPHTB). Law No. 20 of 2000.
B. Local Tax and Local Retribution
The legal basis for its implementation is Law No. 28 of 2009. Local Tax is divided into
two parts; Province Tax and City Tax. Province Tax includes Cigarettes Tax, Vehicle Tax, etc.
While City Tax includes Hotel Tax, Restaurant Tax, Parking Tax, etc. When there is a region
included in both types such as DKI Jakarta, then the amount of tax will be accumulated. The
percentage of tax is determined by the local government, varying different range of tariff. When
the Wajib Pajak (tax payers) want to pay their tax, they bring SKPD and other documents to
fulfill. The tax bill is expired after 5 years.
Local Retribution’s object to be billed are general service, business service, and certain
permission. There are different principles to determine the amount of tax, depends on the object.
When the tax payers want to pay their tax, they bring SKRD and other documents to fulfill, and
there are consequences of being late. The tax bill is expired after 3 years.

The article by Annette M. Nellen explained briefly about The AICPA’s 10 guiding principles of
a “good” tax system in a nation, including equity and fairness, certainty, convenience of payment,
economy of collection, simplicity, neutrality, economic growth and efficiency, transparency and
visibility, minimum tax gap, and appropriate government revenues. It also provides three cases which
analyze the proposals and represent that not all 10 principles can be achieved to the same degree.