Tax Educators as Product of Tax Reform

By: Maya Alfiandari, employee of the Directorate General of Taxes

Indonesia as one of the vibrant emerging economies has continued developing prudent and sustainable fiscal policy to support its development objectives. It began in 1983 when the Ministry of Finance RI introduced a comprehensive fiscal reform package to reduce its economic dependence on oil and gas. The 1983’s fiscal reform introduced a modern taxation approach in the area of corporate and individual income tax through the introduction of a self-assessment regime and the introduction of a more efficient consumption tax in the form of VAT tax.  This reform has become the backbone for further fiscal and taxation reform and has become part of DGT's organizational continuous improvement strategy to cope with the latest economic and technological development.

Tax Reform on Human Resources Side

As part of the implementation of the continual improvement paradigm, The Directorate General of Taxes enacted new reform initiatives that focused on the improvement of information technology and human resources through the PSIAP program. On the human resources side, DGT reallocates many of its structural job position to more agile function-based positions. By implementing a function-based job group, DGT hopes that this job specialization will improve the effectiveness as well as efficiency of the tax policy implementation. Moreover, through this specialization, the staff will have a clearer career path and a more comprehensive career development program based on their specific qualification and their core competence.

However, besides its promising benefits as mentioned above, this specialization might reduce flexibility in the staff's cross-functional interoperability. This condition appears since every job position has a specific job qualification. To address this issue, DGT introduces two types of function-based job groups. First, DGT creates what so-called the single job function group. This job group is specific and separated from other job functions. Besides the single job group, DGT also introduced a cluster-based job group. This cluster-based job group was created by merging several job function that has similarity in their expertise qualification and business process.

Tax Educator and Tax Compliance

An example of the implementation of a function-based job position is Tax Educator. The main task of the Tax Educator function is to disseminate tax information to the public. The effective tax policy dissemination, especially for the newly released tax rule, assure a smooth implementation of tax ruling and policy.

To the Directorate General of Taxes, Tax Educator had an important role in gaining tax compliance. In the end, Tax Educators also take a part in tax revenue. Different methods were used to make a suitable approach to Tax Payers. One of them is a persuasive method through tax education.

Tax education is an early step to collect taxes. There are two strategies implemented to strengthen Indonesia's Tax Revenue, that is the implementation of tax extensification and the intensification strategy. Tax extensification is an effort made by the government to increase state revenue by expanding the tax base, both tax objects, and subjects (Suparmono and Damayanti, 2010). With it, the number of taxpayers is increasing, new taxes are found and the scope of existing taxes is expanded. On the other hand, intensification is an activity to optimize the extraction of tax revenue on tax objects and subjects that have been registered or registered in the DGT administration, and from the results of the implementation of taxpayer extensification (Vergina and Juwita, 2013). Directorate General of Taxes intensifies all efforts to increase tax revenue.

For example, Tax Educators started to give education for Voluntary Disclosure Program even from before the program started until it ended on June 30th, 2022. Tax Educators educate in various ways. Some educations were held online, and some were held offline. Some media are used to deliver tax information to the public such as mass media, online media, radio, television, and newspaper. Tax Educators even educate through social media such as Instagram and YouTube. They made Instagram Live and YouTube podcasts.

The impact of tax education may come instantly, but it may also come later. On special occasions such as Voluntary Disclosure Program, some participants instantly pay their tax right after tax education. Some participants may need more “one by one” consultation to fulfill their tax obligation.

Education for future taxpayers segmented for students from elementary school, junior high school, senior high school, and college. Tax material for this kind of education is specially made based on their stages so students understand tax benefits from their perspectives.

Therefore, the existence of Tax educators is needed nowadays. Every citizen has the right to know tax knowledge and information. Directorate General of Taxes act of service in self-assessment system manifested in Tax Educator.

*)This article is the author's personal opinion