Individual Corruption

Corruption in the tax administration on the individual level does not appear to be a major problem in Indonesia. For instance, only a small percentage of the surveyed households from Transparency International’s Global Corruption Barometer 2010 had experienced demands for bribes in relation to tax revenue services in 2009.

Business Corruption

Large variations exist in taxes and taxation practices in Indonesia's different regions due to what the US Department of State 2008 describes as the vagueness of laws and the substantial interpretations of implementing offices. Global Integrity 2009 also reports that tax laws are not always enforced uniformly or without discrimination in Indonesia. Furthermore, more than one-tenth of the surveyed companies in the World Bank & IFC Enterprise Surveys 2009 expect to give gifts in meetings with tax officials.

Political Corruption

According to a November 2010 news release by Transparency International Indonesia, the tax office is viewed to be the second most corrupt institution by the general public in Indonesia.

In January 2011, a former tax official, Gayus Tambunan, was sentenced to seven years in prison for four counts of corruption, including bribing his way out of bribery charges. According to a 2011 news article by BBC, Tambunan was charged with accepting bribes from companies so that they could avoid paying taxes. The case also implicates several others, including prosecutors and police officials, whom Tambunan had previously paid bribes to in exchange for letting him out of jail and avoiding charges.

In February 2011, a former tax director was sentenced to 10 years in prison for corruption and money laundering. According to a 2011 news article by Jakarta Globe, the court ordered the seizure of the tax director’s money after he failed to prove the money had come from lawful sources.

Frequency

The World Bank & IFC: Doing Business 2011:
- Companies spend an average of 266 hours a year dealing with taxes and make 51 payments (twice the regional average), at a total tax rate of 37%.

Transparency International: Global Corruption Barometer 2010:
- Nearly 8% of households who had contact with tax revenue services throughout 2009 report to have paid a bribe.

The World Bank & IFC: Enterprise Surveys 2009:
- 5% of companies consider the Indonesian tax administration as a major constraint.

- 14% of the companies surveyed expect to give gifts in meetings with tax officials.

Transparency International: Bribe Payers Index 2008:
- Business executives give tax revenue authorities a score of 3.5 on a 5-point scale (1 being 'not at all corrupt' and 5 'extremely corrupt').