IBU CONSULTING -TAX CONSULTANT IN BALI: THE INFLUENCE OF IDEALISM AND PROFESSIONAL COMMITMENT ON ETHICAL DECISION MAKING

IBU CONSULTING –TAX CONSULTANT IN BALI: THE INFLUENCE OF IDEALISM AND PROFESSIONAL COMMITMENT ON ETHICAL DECISION MAKING

Tax consultants in Bali strive to support development in Indonesia from the taxation side. Indonesia as one of the developing countries is currently aggressively making efforts to improve the quality of people’s welfare by implementing national development. National development in terms of infrastructure, education and health continues to be carried out. It certainly requires a lot of funds. In order to finance the various development projects in Indonesia, most of the money is taken from taxes and natural resources that are available.

Taxes are the largest source of state revenue used to finance the country’s needs. The definition of Tax Revenue according to Chairil Anwar Pohan (2017: 233) is the primary source of funding for the State budget. Taxes are significant source of State and local revenue. Tax revenue is the income which government received from the taxes paid by the people. The funds received in the state treasury will be used for government expenditures for the greatest prosperity of the people, as the purpose of the state agreed upon by the founders of this country is to improve the welfare of the people, creating prosperity based on social justice (Suherman, 2011). Taxes managed by the central government are a source of state revenue in the State budget (APBN), while taxes managed by local governments are a source of regional revenue in the Budget for Regional Income and Expenditure (APBD). Basically, state revenue is divided into two types of revenue, namely revenue from taxes and non-tax revenue (PNBP). Sources of revenue from taxes include income tax (PPh), value-added tax (PPN), sales tax on luxury goods (PPnBM) and stamp duty.

The important role of taxes in national development efforts as a large source of funds causes the government to make various kinds of efforts to maximize tax revenue in Indonesia. Various efforts have been made by the government to increase the realization of tax revenues, one of which is by implementing a self-assessment tax calculation system The self-assessment system that applies in Indonesia gives taxpayers complete confidence in the calculation, payment, and reporting of their tax obligations. Taxpayers determine the amount of tax payable themselves and tax officials are tasked with overseeing the process. The number of new regulations and guidelines issued by the government in relation to taxation, leading to a lack of understanding of these regulations and guidelines by many taxpayers. This is why the role of Tax Consultants is so important. They help taxpayers to fulfill their tax obligations.

Tax consultants are persons or entities that provide consulting services regarding taxation to taxpayers in order to fulfill their tax obligations in accordance with applicable tax laws and regulations. Tax consultant is one of the professions that often experience dilemmas in making ethical decisions in carrying out their profession. Tax consultants, particularly those in Bali, have seen an increase in work related to Tax Amnesty. Tax Amnesty is the elimination of taxes that should be paid by disclosing assets and paying ransom as stipulated in Law No. 11 of 2016 concerning Tax Amnesty. The existence of Tax Amnesty is one of the reasons for the increasing demand for tax advising services, especially in Bali.

Devos (2012) states that taxpayers use tax consultants to represent them for a number of reasons. The reasons stated by Devos (2012) include: the desire to file report an accurate tax return mainly due to their lack of tax knowledge based on the complexity of current tax law, the desire to minimize their taxes required to be paid, their fear of making mistakes and being penalized, or simply due to lack of time to complete it.

Tax consultants are one of the accounting professions that often face ethical dilemmas in practice of their profession. An ethical decision is a one that is both morally and legally acceptable to the wider community (Jones, 1991 in Novius and Sabeni, 2008) This situation certainly threatens credibility and integrity in terms of carrying out their professional duties. The dilemma in ethical decision-making exposes tax consultants to make decisions that go against their conscience according to the principles of professionalism. If a tax consultant handles a taxpayer who in the end the taxpayer experiences a dispute or even becomes a suspect in a tax criminal case, it will have an unfavorable impact on the tax consultant.

One of the things that can put a tax consultant in an ethical dilemma is time budget pressure. Time budget pressure is pressure that arises from the limited resources that can be given to carry out tasks. Tax consultants are given a grace period (time budget) to calculate, pay and report the client’s tax return which they handle. Therefore, tax consultants must be able to manage time and provide the best service and must be able to make ethical decisions based on applicable tax regulations.

According to Tjiptohadi (1996) in Khikmah (2005: 143) professionalism has several meanings. Firstly, it refers to expertise, qualifications, and experience in a specific field. Secondly, professionalism refers to the moral and ethical principles that define a standard of work for a given profession. Thirdly, professional means moral. Larkin (1990) states that professional commitment is loyalty to the profession owned by individuals. Professional commitment refers to the strength of an individual’s identification with his profession. Mowdayiet (1979) said that individuals with high professional commitment have high trust and acceptance in the goals of the profession, desire to do their best on behalf of the profession and have a strong desire to maintain their existence in the profession.

Research by Abdurrahman and Yuliani (2011) found that professional commitment has a significant effect on ethical decision making. According to Jeffreyi and Weatherholt (1996), strong professional commitment will lead auditors to comply with rules. This means that the higher the professional commitment of the tax consultant, the more ethical the decision made by the tax consultant will be. High professional commitment should be able to drive tax consultants to professional behavior in accordance with the public interest and avoiding any behavior that endangers their profession. Forsyth (1980) and Shaubet (1993) identified idealism as one of the important predictors of moral judgment. Idealistic attitudes are defined as impartiality and independence from various interests.

Thus, in general, the research results show that tax consultants who have high professional commitment will tend to make increasingly ethical decisions. Professional commitment with high idealism should always be maintained by tax consultants, especially tax consultants in Bali so that they can make the right ethical decisions.

Author: Ni Putu Dyah Amarawati (Bali State Polytechnic PKL Student at IBU Consulting Tax Consultant in Bali)