Tax amnesty to cleanse Indonesia underground economy, Riady says

SINGAPORE (Oct 5): Indonesia’s tax amnesty will potentially help clean up the “underground” economy as people build more trust in the government, said billionaire Mochtar Riady, chairman of Lippo Group.

“The uncertainty in politics and the economy led to a big underground economy,” Riady, 87, said in a Bloomberg Television interview in Singapore. “Indonesia is very lucky to have Jokowi, who made an important decision. Our tax base will be increased so much and the government will have substantial tax income.”

President Joko Widodo has staked his credibility on an ambitious tax amnesty plan aimed at repatriating Indonesian cash stashed overseas, while giving evaders a way to come clean. He ordered his cabinet to summon the biggest taxpayers, especially those with assets held overseas, to ensure they participate. Since the amnesty began in July, the finance ministry has collected 97.2 trillion rupiah ($10.3 billion) from the programme, or 59% of a targeted 165 trillion rupiah.

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