Wealthy families face tax audits as Indonesia races to plug deficit

Officials have told big firms run by local tycoons to pay additional dues in 2025

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Indonesia is seeking to plug an unusually deep revenue shortfall before the end of 2025 by scrutinising wealthy individuals and big businesses for extra tax payments.

As the country's budget deficit projection edges towards a 3 per cent gross domestic product cap, tax officials have stepped up scrutiny of the rich, summoning some to review their returns in an effort to boost collections in what has been an anaemic year for receipts in Southeast Asia's largest economy.

Several people familiar with the situation said officials have recently told big firms run by local tycoons to pay additional dues in 2025.

A few family businesses were asked to pay more than US$5 million (S$6.46 million).

When several of those family-run companies pushed back, tax officials proposed they pay 30 per cent of the requested amount as a compromise, without giving a reason as to how they landed on that figure, the people said, asking not to be identified because the matter is sensitive.

The tax office push has extended to some white-collar professionals as well, with investigators auditing returns for any errors, one person said.

Dr Bimo Wijayanto, the Finance Ministry's director-general of taxes, confirmed the recent summons issued to high-wealth taxpayers, describing it to reporters at a briefing on Dec 18 as "essentially a routine task of the tax office in order to clarify data".

The ministry's data, he added, is "increasingly complete" and the summons "give taxpayers the opportunity to provide explanations, voluntarily correct their tax returns and ensure compliance".

Dr Bimo did not identify the summoned taxpayers, and it is unclear how many businesses and individuals have been approached.