What is tax.
Tax is a mandatory contribution to the state that is owed by an individual or entity that is coercive based on the law, without receiving direct compensation and is used for state needs for the greatest prosperity of the people. Taxes are used to finance the budget related to development and interests country. As a source of state income, taxes function to finance state expenses. Taxes are used to carry out routine state tasks and carry out development.
Problems in the Country
Tax collection in Indonesia experiences many problems, including: Weakness of regulations in the field of taxation itself, lack of socialization, low level of awareness, knowledge and economic level, databases that are not yet complete and accurate, weak law enforcement in the form of supervision and inconsistent sanctions. and firm. To overcome this by carrying out reforms in the field of taxation, including: Improving regulations/rules, promoting socialization to increase knowledge to raise awareness of taxpayers who comply with taxes, conducting evaluations, providing complete, accurate, integrated and guaranteed databases of confidentiality, increasing law enforcement in monitoring and administering sanctions consistently and firmly, and collecting taxes that are: Fair, based on law, do not disrupt the economy, are efficient and the system must be simple.
Several factors that cause low public awareness in fulfilling their tax obligations, taxpayer compliance include public dissatisfaction with public services. This factor is one of the triggers for taxpayers to delay or even not pay their taxes.
The impact of the low tax ratio. The intended impact is that the government finds it difficult to implement and provide services to the community, especially to overcome the problems that the community still faces. For example, during the Covid-19 pandemic, hospital funding weakened due to a lack of funds due to many people not complying with taxes. We cannot completely blame society for non-compliance with taxation. Why? Government services that make people feel in vain when paying taxes make people reluctant to pay taxes. One way to overcome this problem is by improving government services, state facilities, and using tax money properly and correctly without any sense of interference by CORRUPTORS.
Just like the incident some time ago that we know about the son of one of the tax staff who bought his son the newest branded car and the son uploaded it on social media, making people excited, the problem is that they buy branded goods and all the luxuries from the proceeds of tax corruption.
One of the biggest challenges is ensuring that the company complies with all applicable tax provisions. This includes fulfilling reporting obligations, making payments on time, and fulfilling other tax requirements. Tax management has several important functions in your company/entity's tax affairs, namely: Functioning to carry out tax planning. Functions in organizing taxes. Functions in tax implementation. Efforts that can be made in carrying out tax planning to minimize the amount of income tax (PPh) owed by the company are by maximizing excluded income, maximizing fiscal costs, minimizing costs that are not allowed as deductions and selecting accounting methods.
To increase state revenues from taxes, the government needs to expand the tax base (types of goods and services subject to tax), the tax ratio, and increase VAT (value added tax) from the original 10 percent to 12 percent.
In addition, we can reform taxation. Tax reform is a significant and comprehensive change to the tax system which includes improving tax administration, improving tax regulations, and increasing the tax base, an ongoing process carried out by a country to change its tax system. Changes were made to adapt the taxation system to changes in the economic, social and political situation. Tax reform aims to realize the nation's independence in financing national development by further optimizing all domestic capabilities, especially in the field of taxation.
Tax reform will focus on five aspects, namely organizational aspects, human resources aspects, data-based information technology aspects, business process aspects, and tax regulatory aspects.