TAX CONSULTANTS IN BALI ON THE IMPLEMENTATION OF THE CORETAX SYSYEM

TAX CONSULTANTS IN BALI ON THE IMPLEMENTATION OF THE CORETAX SYSYEM

 

TAX CONSULTANT SERVICE IMPROVEMENT IN BALI

Since the advent of the pandemic, every nation’s economy has undergone a period of recovery. This has precipitated a swift metamorphosis in the realm of strategic management, planning, and technology, within both corporate and individual entities. This recovery entails certain obligations, including but not limited to tax payments and reporting. Despite the Directorate General of Taxes’ (DGT) insistence that tax payments are not merely a financial obligation but a beneficial action, some individuals persist in viewing it as a mere imposition. Consequently, there are individuals who have not yet fulfilled their tax obligations.

The current taxation system utilizes self-assessment, empowering the community to conduct independent calculations and reporting. This approach presents challenges for individuals and entities, particularly in navigating the complexities of regulations that are subject to annual changes.

In light of these circumstances, the services of tax consultants are essential in facilitating communication and understanding related to tax affairs (Nugraheni et al., 2021). This development has led to a notable increase in the public’s inclination to utilize power of attorney, a legal instrument that enables individuals to empower another individual to act on their behalf in tax-related matters. According to PMK 175/PMK.01/2022, an amendment from PMK 111/PMK.03/2014, the term “power of attorney” refers to the tax consultant profession, as stipulated by the relevant laws and provisions in the field of taxation (PMK, 2022). Tax consultants are responsible for services in the field of taxation, and they are required to have USKP certification and a legalized practice permit from the Directorate General of Taxes. Currently, there are 351 tax consultant offices in Bali that are members of IKPI. It is expected that tax consultants in Bali are prepared to adapt to changes in legislation and the tax administration system, also known as CORETAX.

CORETAX has implemented a comprehensive education and socialization program in nearly all provinces across Indonesia, including Bali. This socialization is conducted at the Primary Tax Office and is open to the public. To attend, taxpayers must be registered at one of the Primary Tax Offices according to their place of residence or place of work. Tax consultants in Bali have also been involved in the socialization efforts to ensure their readiness to adapt to the new system. The most recent regulations concerning CORETAX are outlined in PMK 81 of 2024, which pertains to Tax Provisions in the Framework of Implementing the Core Tax Administration System. Numerous institutions have disseminated information to the public and will continue to do so.

 

CORETAX LAUNCH  IN INDONESIA

According to the information provided on the official website of the Directorate General of Taxes, the CORETAX system is being utilized in the context of tax reform, given the persistent challenges associated with low compliance from taxpayer, frequent rule changes, and rapid technological advancements (A. Tofan, 2023). Indonesia plans to implement the Core Tax Administration System (CTAS) as part of its ongoing tax reform efforts involving design, development, implementation, support, and maintenance (Darmayasa & Hardika, 2024). Technological development, particularly in the domain of tax administration, has increased in recent years, leading to the emergence of innovative solutions that are efficient, transparent, and promote annual tax compliance. Currently, an innovation is often developed by the government is the CORETAX system.

 

CORETAX SYSTEM

The CORETAX SYSTEM was initiated in response to the promulgation of KMK-885/KMK.03/2016, which pertains to the Formation of the Tax Reform Team. This team subsequently underwent modifications. The CORETAX design constitutes a component of Government Regulation No. 40/2018, which pertains to the Renewal of the Tax Administration System, particularly the Core Tax Administration System Renewal Project. CORETAX stands as one of the five core pillars of tax reform in the domain of information technology and data (A. Tofan, 2023). This regulatory framework is further supported by additional regulatory documents, including:

• Firstly, KMK Number 36/KMK.01/2014 on the Blueprint of the Institutional Transformation Program of the Ministry of Finance 2014-2025 (Kementerian Keuangan, 2014) is a primary source of this regulation.
• The second is KMK Number 974/KMK.01/2016 on Strategic Implementation of the Ministry of Finance’s Bureaucratic Reform and Institutional Transformation Program (Kementerian Keuangan, 2016).
• The third is KMK Number 360/KMK.03/2017 on Tax Reform Program.

The system is designed on a platform that is simpler than the official DGT website as a platform for tax reporting and payment. A distinguishing feature of CORETAX is its incorporation of several convenience features, including automated reporting, real-time data analysis, and cross-system integration. The objective of this integration is to strengthen the tax ecosystem in Indonesia. In essence, the system streamlines tax obligations, such as registration, payment, reporting, audit, and billing.The system transformation is comprised of three stages, namely:

• Existing Business Processes: At present, a variety of applications and systems are already available. However, the application is not fully integrated, since the method is still done manually.
• Bridging Phase: This phase involves the transition of changes in mechanisms and features to those that are more aligned with the latest system. The objective of this phase is to provide users with an overview of the adaptation and implementation process of the system from the previous manual system.
• Business Process To Be: The application has been utilized in an integrated manner in a single view that encompasses all digital aspects.

The implementation of CORETAX will undoubtedly present a series of challenges that must be addressed in both the immediate and long-term future. These challenges include, but are not limited to, the following:

• Technical Understanding and Adaptation

The integration of CORETAX into existing systems will necessitate a comprehensive understanding of its features and operational processes by all involved parties, including consultants. This change will also impact the integration of related regulations, necessitating ongoing education for tax consultants in contemporary technological literacy. The integration of regulatory changes in the domain of taxation will invariably lead to alterations in the manner in which consultants execute their duties, particularly with regard to data collection, verification, and direct delivery. It is, therefore, incumbent upon tax consultants to ensure that the software utilized is compatible with the prevailing system. Moreover, tax consultants are obliged to apprise their clients of the advantages and modifications associated with CORETAX.

• Training and Certification

The Directorate General of Taxes, in collaboration with tax consultants, is currently implementing a socialization program in CORETAX education. This program is being conducted at Primary Service Offices in several cities and is intended to provide an overview to tax consultants. Although this activity is not yet open to the public and the dummy used is not freely disseminated, it is hoped that tax consultants can adapt to this system and disseminate it to the community. Furthermore, tax consultants can monitor the efficacy of the CORETAX system in enhancing work efficiency and compliance.

• Data Security and Privacy

The development of technology has facilitated the seamless execution of all activities. The system has been designed to facilitate this process. In today’s business world, technology-based systems have become increasingly sophisticated. Technology-based systems require a reliable internet connection and adequate servers, which can be challenging to achieve in areas with limited infrastructure. However, it is important to note that these advancements also introduce data security risks, such as the potential leakage of client information. Governments and consultants must ensure that client data is managed in accordance with international and local privacy regulations.  Additionally, human resources professionals with potential in IT (Information Technology) must possess the ability to operate the system. CORETAX, which has begun implementation in early 2025, requires adaptation from several parties, including the government, society, and especially tax consultants. Tax consultants in Bali serve as intermediaries between the Directorate General of Taxes and individual/ corporate taxpayers. They are responsible for ensuring that their clients fulfill their tax compliance obligations. Given the dynamic nature of the CORETAX situation, tax consultants must be prepared to adapt to changes and communicate with the public about features and their applications.