TAX CONSULTANT IN HANDLING MULTINATIONAL COMPANIES

TAX CONSULTANT IN HANDLING MULTINATIONAL COMPANIES

Definition of Multinational Business

A multinational company (MNC) is a large company that is usually located in developed countries and have subsidiaries in developing countries. Since this company conducts its business in various countries, the nature of its business is global. Therefore, it can have a strong influence on global political conditions. In most countries, companies are developed as limited liability companies. However, their shares are often controlled by the headquarters and are not traded on the local stock market. As a result of the ownership model, the overall operating policy of the company depends on the policies of the headquarters. Additionally, some of the company’s management must be sourced from the headquarters.

Types of Multinational Companies:

1. A multinational company that is decentralized in its original country, i.e. it has its own organizational structure. Therefore, each manager has his/her own decisions, such as responding to opportunities, without having to seek permission from the head office.
2. Centralized global companies, which are companies with centralized offices and management. These companies make profits by utilizing cheaper resources in other countries.
3. International companies, which establish research and development to improve quality, production efficiency and create new products.
4. Transnational companies are a type of multinational company that combines the methods of the three companies above.

There are characteristics of multinational companies that we can easily recognize including:

1. Forming branches abroad.
2. The scope of the company’s income generating activities extends beyond national borders.
3. Trade of multinational companies mostly occurs within their own scope, although between countries.
4. The company places a high priority on controlling technology and capital as they are essential for running the business in various countries.
5. Development of management and distribution systems that cross national borders, especially venture capital, license, and franchise systems.
6. It tends to choose a specific business, usually manufacturing.
7. The vision and strategy used for production are usually global in nature.
8. Multinational companies typically hire local citizens to run their business

As Bali is a popular tourist destination, it attracts many investors who establish multinational companies there. This, in turn, raises tax-related concerns.   As a result, investors often seek tax consultant services in Bali.

In reality, tax consultants in Bali and Indonesia do not always have good clients. Many consultants encounter problems when dealing with tax implementation. Therefore, consultants must be observant when selecting clients and navigating the market.

Definition of Tax Consultant

A tax consultant is a professional who provides advice on taxation, including tax calculations and procedures, to individuals and businesses.

A tax consultant is a professional who assists taxpayers in managing all tax-related matters, ensuring that they fulfill their tax obligations accurately.   Tax consultants are essential to ensure compliance with tax regulations and promote business growth. In Indonesia, many companies rely on tax consultant services to resolve taxation issues efficiently and professionally.

Tax advisers in Bali must hold a license and certificate to practice, as do tax advisers in Indonesia. The license is issued by the Directorate General of Taxes and comes with important requirements. They will be bound by some important requirements. Some of the requirements to become a Tax Consultant include:

• Indonesian citizen
• Residing in Indonesia
• Have at least a Bachelor’s degree or its equivalent
• Not related to work or position in the Government / State or Regional Owned Enterprises
• Have an NPWP (Nomor Pokok Wajib Pajak or Taxpayer Identification Number)
• Have a Tax Consultant Certificate
• Willing to become a member of a tax consultant association such as: IKPI (Indonesian Tax Consultant Association) and comply with the Code of Ethics of the Tax Consultant Association.

Legal Basis of Tax Consultant

The provisions on Tax Consultant are regulated in the Minister of Finance Regulation of the Republic of Indonesia Number 111/PMK.03/2014 on Tax Consultant. The Ministerial Regulation contains General Provisions, Tax Consultant Requirements, Tax Consultant Practice License, Tax Consultant Certificate, Tax Consultant Certification Organizing Committee, Tax Consultant Association, Rights and Obligations of Tax Consultants, as well as Reprimand, Suspension, and Revocation of Practice License.

Therefore, it is recommended for tax consultants in Bali to be more careful in choosing clients. There have been several cases of misuse of services and opinions of tax consultants by taxpayers, this will be a big homework for tax consultants in Bali, which is obviously the world’s attention because of its tourist destinations.