The Influence of Modernization of Tax Administration System to Taxpayer Compliance
THE INFLUENCE OF MODERNIZATION OF TAX
ADMINISTRATION SYTEM TO TAXPAYER COMPLIANCE
By:
Evie Trie Hardiani
109082100022
DEPARTMENT OF ACCOUNTING INTERNATIONAL CLASS PROGRAM FACULTY OF ECONOMICS AND BUSINESS SYARIF HIDATULLAH STATE ISLAMIC UNIVERSITY
JAKARTA 1434 H/2013
(2)
(3)
(4)
(5)
(6)
i
CURRICULUM VITAE
Personal Data
Full Name : Evie Trie Hardiani
Nick Name : Evi
Address : Jl. Saketi-Malingping km 7 kp.Sukamaju Rt 12/03 desa Bojong,Pandeglang-Banten
Mobile Phone : 087822288558
E-mail : evi_hardiani@yahoo.com
Place, Date of Birth : Pandeglang, April 28,1991
Gender : Female
Religion : Islam
Nationality : Indonesia
Education
Elementary SDN 4 Bojong 1997-2003
Junior High School SMPN 1 Bojong 2003-2006
Senior High School SMAN 1 Pandeglang 2006-2009
University UIN Syarif Hidayatullah Jakarta 2009-now
Major: Accounting international class program
Work Experience
Internship at Koperasi DPR-RI Jakarta (2012)
Organization Experience
Member of OSIS SMPN 1 Bojong
(7)
ii
The Influence of Modernization of Tax Administration System to Taxpayer Compliance
ABSTRACT
Objectives to be achieved in this research, is to analysis the influence of implementation modernization administration system of taxation with of 4 dimensions, which is organizational structure, organizational procedure, organizational strategy and organizational culture toward taxpayer compliance. This research have done by taxpayer in Tax Service Office (KPP) Pratama Senen, Jakarta. The sampling method using is convenience sampling. 100 questionnaires was distributed to the taxpayer with the criteria of respondents in Tax Service Office (KPP) Pratama Senen, Jakarta. Test used was multiple regressions. The results showed that modernization administration system of taxation with of 4 dimensions, which is organizational structure, organizational procedure, organizational strategy and organizational culture significantly influence taxpayer compliance either partially or simultaneously. Based on the result of multiple regressions test was found that the most dominant variable is the variable organizational procedure, it can be seen by the beta value of 0.319.
Keyword: Modern Tax Administration System, Organizational Structure, Organization Procedures, Organizational Strategy, Organizational Culture, Taxpayer Compliance.
(8)
iii
Pengaruh Penerapan Modernisasi Sistem Administrasi Perpajakan Terhadap Kepatuhan Wajib Pajak
ABSTRAK
Tujuan yang ingin dicapai dalam penelitian ini, yaitu untuk menganalisis pengaruh penerapan modernisasi system administrasi perpajakan yang dilihat dari empat dimensi yaitu struktur organisasi, prosedur organisasi, strategi organisasi, dan budaya organisasi terhadap kepatuhan wajib pajak. Penelitian ini dilakukan pada wajib pajak yang terdaftar pada KPP Pratama Senen, Jakarta. Metode pengambilan sampel dengan menggunakan tekhnik convenience sampling. Kuesioner telah disebarkan kepada wajib pajak sebanyak 100 kuesioner dengan kriteria responden yang terdaftar di KPP Pratama Senen, Jakarta. Uji yang digunakan adalah regresi berganda. Hasil penelitian menunjukkan bahwa modernisasi system administrasi perpajakan yang dilihat dari empat dimensi yaitu struktur organisasi, prosedur organisasi, strategi organisasi dan budaya organisasi berpengaruh signifikan terhadap kepatuhan wajib pajak baik secara parsial maupun simultan. Berdasarkan hasil uji regresi berganda ditemukan bahwa variable yang paling dominan adalah variable prosedur organisasi, dapat dilihat berdasarkan nilai beta sebesar 0,319.
Katakunci: modernisasi sistem administrasi perpajakan, struktur organisasi, prosedur organisasi, strategi organisasi, budaya organisasi, kepatuhan wajib pajak.
(9)
iv FOREWORD
Assalammu'alaikum Wr.Wb
All Praise to Allah SWT as the Hearer, the Seer and above all an abundance of grace, Taufiq, as well as his guidance. So, because Allah SWT I can finish this research on time.
Shalawat always gives to the Prophet of Muhammad SAW and all his family and friends who always helped him in establishing Dinullah in this earth.
With the strength, intelligence, patience, and strong desire from Allah SWT, I am able to finish this mini thesis as graduation pre requirement for bachelor degree. I believe there is an invisible hand which have helped me going through this process.
My special thank for my supermom, Eri Komariah, who had supported with your best way and never gave up to educate me to be a good son. So, I want to make you smile and proud of me, because your smile can make me feel piece and calm in any situations that I have faced. You always pray for the pleasure of your family and me. You always wake up in the middle of the night, just to talk to Allah SWT and hoping that your family will always be blessed by Allah SWT. Therefore, I just want to give the best of me. Thank you for everything mom. I love you so much. You are the best mother in this whole word, I promised to make you happy and proud of being a son that you want, and I’m thanking to Allah to give me a chance as your little girl.
My beloved father, Asep Tiawarman who give me lots of spirit and positive energy when I felt hopeless to finish this mini thesis. You always believed that I can do everything with myself. You are always beside me when I need your support. You
(10)
v
are the first men that I want to say thanks in the world when I finish this mini thesis. Thank you for everything my superdad. Thanks for the hard work that had you done for the family. Thanks a lot for being great father ever for me. And I’m very glad to be your little girl. I love you so much dad.
I believe I am nothing without each one of you who has helped me in finishing this mini thesis. So I would like to say thanks to all of them who have been helping me the process of this thesis, including:
1. Prof.Dr.Abdul Hamid, MS as dean of the faculty of Economics and Business 2. M. Arief Mufraeni, Lc.,Msi as Head of International Program.
3. Ahmad Dumyathi Bashori, MA as Secretary of International Program.
4. Prof. Dr. Azzam Jasin as my thesis supervisor 1. You are my mentor who has provided direction and guided me, shared your knowledge to me, and thank you for your time that you gave .So, I able to finish this mini thesis.
5. Wilda Farah,SE,MSi,Ak as my thesis supervisor II who has provided direction, guidance, and thank you for your time and your patience that you gave to me, so I can finish this mini thesis.
6. All Lecturers who have taught patiently, may what they have given are recorded in Allah SWT almighty and all staff UIN Jakarta.
7. All of taxpayer in Tax Service Office (KPP) Pratama Senen, Jakarta for giving me your time to filling my questionnaire. So, I could finish my mini thesis.
8. My brothers, Ricky Tiawarman and Teddy Gunawan and my sisters, Endah Nurhayati and Hayya who always helped and supported me for my best, whatever I do and whenever it is.
9. All my friends in accounting international 2009, more than 3 years we are classmates, we have been through together with different characters, but you are still best friends and special thanks for some of you who have always helped me in learning and especially in doing thesis. Thanks also for my friends in management international 2009.
(11)
vi
10.Thanks for all seniors and juniors who have prayed and give me spirit. Special thanks to kak Lucki and kak dwi, thanks for your information and help in my thesis process. Thanks a lot.
I realize this mini thesis is still far from perfection, thus suggestions and constructive criticism from all parties are welcome, in order to improve my thesis. Finally, only Allah SWT will return all and I hope this thesis will be useful to all parties, especially for writers and readers in general, may Allah bless us and recorded as the worship of Allah’s hand. Amin.
Wassalammualaikum Wr.Wb
Jakarta, May 2013
(12)
vii
LIST OF CONTENT
Curriculum Vitae ... i
Abstract ... ii
Abstrak ... iii
Foreword ... iv
List of Content ... vii
List of Table ... xi
List of Figure ... xii
List of Appendix ... xiii
CHAPTER I INTRODUCTION A.Background ... 1
B.Problem Definition ... 8
C.Purpose and Benefit ... 8
CHAPTER II LITERATURE REVIEW A.Taxation ... 10
1. Definition of taxation... 10
2. Function of taxation ... 12
3. The principle and basic of tax levy ... 13
4. System of tax levy ... 14
(13)
viii
B. Taxpayer ... 18
1. Definition of taxpayer ... 18
2. Subject of taxation ... 18
3. Right and obligation of taxpayer ... 18
C. Modernization System of Taxation Administration ... 20
1. Definition of Administration ... 20
2. Administration of Taxation ... 21
3. Reform of the Taxation Rules ... 22
4. The History of Taxation Administration System ... 25
5. Reform of the Taxation Administration System ... 27
D. Dimension of Application of Modernization of Taxation Administration System... 31
1. Organizational Structure ... 32
2. Organizational Procedure ... 35
3. Organizational Strategy ... 36
4. Organizational Culture ... 37
E. Taxpayer Compliance ... 38
1. Definition of Compliance... 38
2. The Factors That Affect Taxpayer Compliance... 39
3. Criteria of taxpayer compliance ... 40
F. Previous Research ... 41
G. Theoretical Framework ... 44
(14)
ix
CHAPTER III RESEARCH METODHOLOGY
A. Scope of Research ... 52
B. Sampling Method ... 52
C. Data Collection Method ... 53
1. Primary Data... 53
2. Secondary Data... 54
D. Data Analysis Method ... 54
1. Descriptive Statistic ... 54
2. Data Quality Test ... 55
a. Validity of Test Data ... 55
b. Reliability Test Data ... 55
3. Classic Assumption Test ... 56
a. Test of Normality ... 56
b. Test of Multikolonieritas ... 56
c. Test of Heteroskedastisitas ... 57
4. Hypothesis Test ... 58
a. Multiple Regression Test ... 58
b. Coefficient Determination Test (Adjusted R2) ... 59
c. Partial Regression Testing (T Test) ... 59
d. Significant Simultaneous Test (Test Statistic F) ... 59
(15)
x
CHAPTER IV RESULT AND ANALYSIS
A. An Overview of The Research Object ... 69
B. Analysis and Discussion ... 76
1. Test Results of Descriptive Statistic ... 76
2. Result of Data Quality Test ... 77
a. Result of Validity Test ... 77
b. Result of Reliability Test ... 80
3. Result of Classic Assumption ... 82
a. Result of Normality Test ... 82
b. Result of Multicolonierity Test ... 83
c. Result of Heteroscedastic Test ... 84
4. Result of Hypothesis Test ... 85
a. Result of Multiple Regression Test ... 85
b. Result of Coefficient Determination Test (Adjusted R2) ... 86
c. Result of Partial Regression Testing (t-test)... 87
d. Result of Significant Simultaneous Test (F Test) ... 92
C. Interpretation ... 93
CHAPTER V CONCLUSION , IMPLICATION AND RECOMENDATION A. Conclusion ... 98
B. Implication ... 99
C. Recommendation ... 102
REFFERENCE ... 103
(16)
xi
LIST OF TABLE
NO INFORMATION PAGE
1.1 The Realization Revenues of The Country ... 2
2.1 The Obligation of Taxpayer ... 20
2.2 Differences between the Old System and the New System ... 31
2.3 Previous Research ... 42
3.1 Scale Likert ... 54
3.2 Research Operational Variables ... 67
4.1 Questionnaires Distribution ... 74
4.2 Characteristic Respondents ... 74
4.3 Descriptive Statistics ... 76
4.4 Result of Validity Test Variable Organizational Structure ... 78
4.5 Result of Validity Test Variable Organizational Procedure ... 78
4.6 Result of Validity Test Variable Organizational Strategy ... 79
4.7 Result of Validity Test Variable Organizational Culture ... 79
4.8 Result of Validity Test Variable Taxpayer Compliance ... 80
4.9 Result of Reliability Test ... 81
4.10 Result of Multicollinearity Test ... 83
4.11 Result of Multiple Regression Test ... 85
4.12 Result of Coefficient Determination Test (Adjusted R2) ... 86
4.13 Result of Partial Regression Testing (t-test) ... 88
(17)
xii
LIST OF FIGURE
NO INFORMATION PAGE
2.1 Theoritical Framework ... 46 4.1 Result of Normality Data Test ... 82 4.2 Result of Heteroscedasticity Test ... 84
(18)
xiii
LIST OF APPENDIX
NO INFORMATION PAGE
Appendix 1 Research of Questionnaire ... 106
Appendix 2 The Result of Questionnaire ... 113
Appendix 3 Result of Validity and Reliability Test SPSS 20 ... 127
Appendix 4 Result of Multiple Regressions Test ... 132
(19)
1
CHAPTER I INTRODUCTION
A. Background
National development in a country in fact organized by the people, together with governments that cooperate with each other to be able to realize successful national development that creates a fair and prosperous society based on Pancasila. The role of government becomes very important and has strategic position because it is impossible to drive the governance program and national development without the financial support mainly from the domestic revenues from tax revenue sector.
Indonesia is a country that is actively doing development. This requires an appropriate strategy in order the achieved equitable economic development can be enjoyed by all segment of society. In implementing the national development, the government needs a lot of amount of funds. These funds can be obtained from inside or outside of the country. Funds from inside may be obtained from export activities, tax revenues, and non-tax revenues. Whereas the funds from outside can be obtained from foreign loans and grants.
Tax is a source of non-oil and gas revenues that is important to finance government expenditure, either routine expenditure or construction expenditure. Taxes as the biggest source of income are inseparable part of the development of Indonesia. One of them is a source of financing for the state
(20)
2 budget (APBN). State budget created by the Government itself consists of three main sources of revenue, namely: 1) tax revenues, 2) oil and gas revenues, and 3) non-tax revenue. From year to year, we can see that the tax revenue continue to rise and give a large participation for state income. Tax revenue is always said to be reliable in financing national development. The role of tax revenue in the state budget in the activity of national development is very important and very strategic, a big size of such taxes may need to be embedded within each person in complying payment of taxes in order, it can be a pride for having contribution to national development. The contribution of tax revenue to the state can be seen in table 1.1 below:
Table 1.1
The Realization Revenues of the Country (Billion rupiah) 2007-2012
Note : Differences in the single digits behind due to rounding
The Source of the Revenue 20071) 20081) 20091) 20101) 20112) 20123)
Tax Revenue 490,988 658,701 619,922 723,307 878,685 1,019,333 Domestic Tax 470,052 622,359 601,252 694,392 831,745 976,900 Income tax 238,431 327,498 317,615 357,045 431,977 512,835 Value added tax 154,527 209,647 193,067 230,605 298,441 350,343 Land and building tax 23,724 25,354 24,270 28,581 29,058 35,647 Duties on land and building
transfer
5,953 5,573 6,465 8,026 - - Excise 44,679 51,252 56,719 66,166 68,075 72,443
Other Tax 2,738 3,035 3,116 3,969 4,194 5,632
Taxes On International Trade
20,936 36,342 18,670 28,915 46,940 42,433 Import Duties 16,699 22,764 18,105 20,017 21,501 23,534 Export Duties 4,237 13,578 565 8,898 25,439 18,899 Non-Tax Revenue 215,120 320,604 227,174 268,942 286,568 272,720 Natural Resources 132,893 224,463 138,959 168,825 191,976 172,871 Profit transfer from SOE's 23,223 29,088 26,050 30,097 28,836 25,590 Other non-tax revenue 56,873 63,319 53,796 59,429 50,340 54,398 Revenue Agency Public
Service (BLU)
2,131 3,734 8,369 10,591 15,416 17,861 Amount 706,108 979,305 847,096 992,249 1,165,253 1,292,053 Percentage of tax revenues
compared to Total
(21)
3 1) Central Government financial reports (LKPP)
2) State budget income and Expenditure– changes (APBN-P) 3) Plan State Budget income and Expenditure (RAPBN) Source : Central Bureau of Statistics and the Data processed
From table 1.1 above it can be seen that most of the state's revenues derived from tax revenue, year to year tax revenues are increase.
To strengthen the implementation of taxation in Indonesia, then as the basis is the Constitution of 1945 article 23 A which states that tax and other charges which are forced for the purposes of the state are governed by law. The provisions of legislation regulating taxation currently include:
1. Act No. 28/2007 about the third change of the General Provisions and Taxation Procedures Law.
2. Act No. 36/2008 about the fourth change of Act No. 7/1983 on Income Tax Law.
3. Act No. 18 of 2000 about Value Added Tax termed Goods and Services and Sales Tax on Luxury Goods.
4. Act No. 12 of 2000 about Land and Building Tax. 5. Act No. 1 of 1985 about the Stamp Duty.
6. Act No. 17 of 1997 about Tax Dispute Settlement Agency. 7. Act No. 38 of 2000 about regional taxes and regional retribution. 8. Act No. 19 of 2000 about Tax Billing with force
9. Act No. 20 of 2000 about Duties on land and building transfer (BPHTB) 10.Act No. 20/1997 about Non-Tax Revenues (PNBP).
(22)
4 The problem that arises is the dilemma when it is viewed from one side of the Country that wants the tax withheld as optimal as possible and achieve target so that the state can do the development. But, on the other hand, the taxpayer are not entirely fulfill their responsibility thus the state income is decreasing, these conditions cannot be denied that there are still people who think that there is no benefit for paying taxes because there is no direct benefits obtained from the government.
To increasing the compliance of people on tax, in order the state revenue will also increase, the Directorate General of Taxes (DJP) make efforts, such as providing a better quality of service and issuing a policy that can increase taxpayer compliance. It aims to implement good governance and excellent service to the society. Besides, issuing the new policies, the tax authorities must also provide a quality service, then by itself, it will develop a sense of trust in the tax authorities so that it will build in the taxpayer compliance. Tax authorities should perform their functions to perform services fairly, the tax authorities must also be friendly, not arrogant, and need to put the taxpayer himself equally in the context of business partners and which are no less important is the assurance that paid taxes come to the State Treasury, so that the society will be encouraged comply the obligations of the taxation. Tarjo and Sawarjono (2005) in Mega (2008: 5).
One of the policies issued by the Directorate General of Taxes in the implementation of good governance is the application of the tax administration system. Since the beginning of the year 2000, the
(23)
5 modernization of the system administration of taxation have been applied in Directorate General of Taxes (DJP). According to Chaizi Nasucha, reform of the tax administration is a refinement or improvement of the performance of the administration, either by individual, group or institutional in order to be more efficient, economical, and fast. Bird and Jantscher (1992), as quoted by Chaizi Nasucha, argued that in order for the reform of the tax administration can be successful, it needs to: (1) a simplified tax structure for ease, administration, and compliance, (2) a suitable reform strategy should be developed, (3) a strong political commitment to the improvement of the administration of taxation.
According to Gunadi (2010), the tax administration is prosecuted to be dynamic in an effort to increase the application of an effective taxation policy. Feasibility criteria of administration demand that the new tax system can minimize administrative costs and the cost of compliance and make tax administration as part of its tax policy. The concept of modernization of tax administration basically is a change in the tax administration system that can change the mindset and behavior of the apparatus as well as the value of the organization so that it can make Directorate General of Taxes becomes a professional institution with a good image in the community. One of the purposes of the implementation of modern administrative system of taxation is to improve the performance of the tax authorities and to improve compliance of taxpayer.
(24)
6 Tax compliance can be defined as a situation where taxpayer comply with tax obligations and implement all their taxation rights. There are two kinds of compliance, namely formal compliance and materials compliance. Formal compliance is a situation where taxpayer comply with tax obligation formally in accordance with the provisions of tax laws. While the materials compliance are a situation where Taxpayer substantively meet all provisions of the material including formal compliance (Lasnofa and Fauzan, 2010).
In research done by Sofyan (2005) about the influence of modern tax administration system implementation on taxpayer compliance in KPP of Directore General of Taxes. The result stated that organizational structure can increase taxpayer compliance significantly. This result had supported researches conducted by Abdul Rahman (2009) and Sri Rahayu (2009) and Lasnofa (2010) which stated that organization structure can increase taxpayer compliance significantly. With the modernization of organizational structure, it can increase taxpayer compliance on tax duty.
The result of researches of Sofyan (2005), Abdul Rahman (2009), and Rapina (2011) stated that organization procedure can increase taxpayer compliance significantly. With the modernization, organizational procedure, such as simplification of administration procedure, improvement of timing standard, quality of services, and tax checking, there is one door services thorough account representative, and with the support from modern information technology in giving servicing, monitoring, checking and tax
(25)
7 claiming, and modernization of other organizational procedure that can increase the taxpayer compliance on doing tax duty.
The result of researches of Sofyan (2005), Abdul Rahman (2009), and Rapina (2011) on the research stated that organizational strategy significantly influence on taxpayer compliance. With good and proper organizational strategy, it can increase the awareness of taxpayer on fulfilling their tax duty. It can be done by doing the campaign of tax care and awareness, simplification of tax administration, intensification of tax revenue, etc. (Abdul Rahman: 224)
The result of Rapina’s (2011) research found that no influence of
organization culture on taxpayer compliance. However, the result of research conducted by Sofyan (2005) proved that organizational culture significantly influence on taxpayer duty. In line with that research, Abdul Rahman (2009) and Lasnofa (2010) roved that organization culture significantly influence on taxpayer compliance
Based on explanation above, then this research intended to prove whether the application of the policy system of modern taxation administration which includes four dimensions of the reform of the administration that are organizational structure, organizational procedures, organizational strategy and organizational culture influence on taxpayer compliance or not. So the research title is, “The Influence of Modernization of Tax Administration System to Taxpayer Compliance”.
(26)
8
B. Problem Definition
The issues that will be discussed in this research are as follows:
1. Is the organizational structure significantly influence to taxpayer compliance?
2. Is the organizational procedures significantly influence to taxpayer compliance?
3. Is the organizational strategy significantly influence to taxpayer compliance?
4. Is the organizational culture significant influence to taxpayer compliance?
C. Purposes and Benefits 1. Purposes
In accordance with the problem definition, this research aims to find out: a. To observe the influence of organizational structure to taxpayer
compliance.
b. To observe of the influence of organizational procedures to taxpayer compliance.
c. To observe of the influence of the Organization's strategy to taxpayer compliance.
d. To observe the influence of organizational culture to taxpayer compliance.
(27)
9
2. Benefits
a. The Author
This research is expected to be the form of implementation of knowledge acquired in university which consists of theories and the fact in real, so the obtained theory can be used to add knowledge for the researcher relates to the influence of the implementation of the system of modern taxation administration on taxpayer compliance on tax services office pratama Senen, Jakarta.
b. Academic
To contribute additional information as additional scientific reference regarding the influence of modernization administration system of taxation to taxpayer compliance in the tax services office pratama Senen, Jakarta and may be additional material for next researchers.
c. The Society
To give information that the construction of the new policy is very important to improve taxpayer compliance that result in increased of State tax revenue, and as the image of the influence of modernization administration system of taxation to taxpayer compliance in the tax services office pratama Senen, Jakarta.
d. Directorate General of Taxes
As input for improvement of system with new better policies and improve the performance/service to taxpayer.
(28)
10
CHAPTER II LITERATURE REVIEW
A. Taxation
1. Definition of Taxation
According to the law No. 28 of 2007, "tax is the contribution of personal taxpayer or corporation which is forced under the law and not get rewarded directly used for State purposes for people's prosperity".
Other than KUP definition, many experts give the limitation or an opinion regarding the meaning of taxation, but essentially has the same goal and purpose. Below, there are several definition of taxation according to some experts:
a. The definition of taxes raised by S.I. Djajadiningrat in Rapina, Jerry and Yenni (2011: 5)
"Tax as an obligation handed over some of his wealth to the State Treasury which is caused by condition, occurrence, and deed that gives certain position, but not as a punishment, according to the regulations set out by the Government and can be enforced, but there is no reciprocal service from the country directly, to preserve the public welfare."
b. Definition of taxes raised by n. j. Feldman in Rapina, Jerry and Yenni (2011: 5)
"Tax is imposed unilateral merit by and payable to the ruler (according to the norms established in General), without any contra-achievement, and used only to cover the expenses of public-expenditure."
c. Definition of taxes raised by Rochmat Soemitro in Siti Resmi (2009: 1)
(29)
11 "Tax is a people's contribution/dues to the State Treasury under the legislation which can be enforced with no reciprocal services (contra-achievement) that can be shown directly, and used to pay for public expenditure."
d. Definition of the taxes raised by Mardiasmo in his book (2009:1) "Tax is a people's dues to the State Treasury under law (which may be forced) and do not get the reciprocal services (contra-achievement) that can be shown directly and used to pay for public expenditure."
From some definition of taxes raised by the experts, it can be concluded that the definition of tax are:
a. Can be withheld under tax laws as well as implementation, based on rules, can be forced.
This is in line with the third amendment of 1945’s Constitution article 23A which stated "taxes and other charges that are forcing for the
State’s purposes is set in the constitution". So it guarantees the legal certainty, both for tax officer as tax collectors or taxpayer. The tax can be forced if taxpayer do not comply tax duty and can be penalized according to the regulations.
b. Taxes are withheld by the central government and local government. Tax is one of the sources of revenue of the State, so if the tax levy is separated between the central government and the local government, then local government will get an equal chance to advance and expand its region.
c. Taxes are used for government expenditures, when there is a surplus can be used to finance Public Investment.
(30)
12 d. In the payment of taxes, it could not be shown any individual
contra-achievement by the Government.
For example, people who keep paying taxes of vehicles will go through the same quality path as people who do not pay tax on vehicles.
2. Function of Taxation
Expressed by Ilyas (2007: 10-11) in Rapina, Jerry and Yenni (2011:5) there were four tax functions, namely:
a. Budgeting Function is a function that is located in the public sector, namely a function for collecting tax money as much as possible in accordance with the laws in effect at the time will be used to finance the expenses of the State, and when there is a surplus, it will be used as government saving for government investment.
b. Regulatory Function which is a function that the taxes will be used as a tool to achieve certain objectives that is outside of financial aspect. c. Democracy Function is a function which is one of embodiment or
manifestation of the gotong-royong system, including the activities of the government and the construction for the benefit of mankind. This function is often associated with a person's right to obtain the services from government when he has performed its duty to pay taxes, if the government does not give good service, taxpayer can complain it.
d. Distribution Function is a function that a greater emphasis on elements of equity and justice in society.
(31)
13 Some understanding of the tax function expressed above it can be concluded that the definition of tax functions are:
a. As a source of state revenue, taxation is to finance the state expenditure. Taxes are used for routine expenditure such as personnel expenditures, material expenditure, maintenance, etc.
b. With the regulatory function, taxes can be used as a tool to achieve a goal. For example, in order to attract capital investment, either domestic or abroad, it is given the wide range of on-site tax relief. In order to protect domestic production, the government set high import duties for foreign products.
c. Taxes that have been withheld by the state will be used to finance all of the public interest, as well as to finance the construction so that it can create jobs, which in turn, will be able to increase the people's income.
3. The Principle and Basic of Tax Levy
To achieve the purpose of the tax levy in the alternative levy, based on the principles of tax levy, so that there is harmony between the tax collector with the purpose and basis.
Adam Smith in his book, “ An Inquiry Into The Nature And Causes Of The Wealth Of nation ", quoted by Santoso Brotodiharjo in his book "Pengantar Ilmu Hukum Pajak (2003: 27), there are four basic principles of the tax levy, namely:
a. Equality
(32)
14 b. Certain
The principle of legal certainty. c. Convenience of Payment
The basis of the on time tax levy or the principle of pleasure. d. Efficiency
The tax should be done economically, do not collect taxes over income taxes.
A basic understanding of some of the tax basis expressed above it can be concluded that the fundamental basis of the poll tax is:
a) Tax Collection performed by the State should be in accordance with ability and income of taxpayer. The State should not act indiscriminately against taxpayer.
b) All tax levies should be based on the tax legislation, so, for those who violate the law will be subject to sanctions.
c) The tax must be withheld at the right time for taxpayer, for example at a time when the taxpayer receives salary or when the taxpayer receives a bonus.
d) Costs of tax levy must be done efficiently, do not get tax levy costs going higher than the results of the tax levy.
4. System of Tax Levy
System of tax levy can be distinguished into three parts (quoted in the book of Siti Resmi, 2009: 11-12), i.e.:
(33)
15 a. Official Assessment System
The levy system which gives is the authority for the tax apparatus to determine personally the tax amount owed each year in accordance with the regulations.
In this system, initiatives and activities to calculate and collect taxes entirely in the hands of the tax apparatus. Thus, successful or unsuccessful of the tax levy depends on tax apparatus.
b. Self-Assessment System
The tax levy system is the system that gives authority to the taxpayer in determining the amount of tax owed on its own each year in accordance with the regulations. In this system, initiatives and activities to calculate and collect taxes entirely in the hands of taxpayer. The taxpayer is deemed to be able to calculate the taxes, is able to understand the current tax law, and has a high honesty and to realize the importance of paying taxes. Therefore, the Taxpayer is given the trust to:
1) Calculate the own tax payable 2) Capable to calculate the tax payable 3) Pay for itself the amount of tax owed
4) Reported by themselves amount of tax owed, and 5) Accountable for tax owed.
Thus, successful or unsuccessful of implementation of the tax levy depends on the taxpayer himself.
(34)
16 c. Withholding System
`The system of tax levy that give the authority to the elected third party to determine the amount of tax owed by the taxpayer in accordance with the regulations. The appointment of third parties is carried out according to regulations, the decree of the President, and other regulations to cut and collect taxes, deposit, and accountable through available facility of taxation.
In this system, the successful implementation of the poll tax depends on the elected third party.
5. Terms of the Tax Levy
In order the tax levy will not cause obstacles or problem, then the tax levy must meet the following requirements (Mardiasmo, 2006: 2-3) in Rapina, Jerry and Yenni (2011: 6):
a. Tax levy should be Fair (Principle of Fairness). According to the purpose of the law, is achieving justice, legislation and implementation of the tax levy should be fair.
b. Tax levy should be based on Legislation in Indonesia (Principle of Jurisdiction)
c. Tax levy should not disturb the economy (Principle of Economic) d. Tax levy must be efficient (Principle of Finance)
e. Tax levy system should be simple
From the requirements above, it can be concluded that the requirements of tax levy are:
(35)
17 1) Fair, according to law, means levying tax must be imposed generally and equally, and adjusted to the capability of taxpayer. While fair according to the execution means giving the right of taxpayer to file objection, postponement of payment and to file appeal to The Consultative Board for Taxes. For example, by setting their right and the obligation of taxpayer.
2) According to article 23 of 1945 Constitution stating: “tax and charge for the purpose of the state is set in legislation”, so that the taxpayer can have legal guarantees to be not behaved in general. 3) Tax levy must be done properly in order it will not disturb the
economic condition, either production activity, trading, or services. Tax levy must not harm the public interest and hamper the activity of taxpayer, especially low and middle class.
4) Cost expensed for tax levy, must be recorded. It may not the tax received is lower than the cost of tax levy. Therefore, tax levy system should be simple and easy to apply. So that, taxpayer will not mind, either in calculation the tax or time.
5) How the tax levied is will determine the success of tax levy. Simple system will ease taxpayer to calculate tax payable, so that it will give positive impact to taxpayer to increase the awareness of tax compliance. In the opposite, if the system of tax levy is complicated, people will be reluctant to pay tax.
(36)
18
B. Taxpayer
1. Definition of Taxpayer
In Act No. 28 of 2007, the definition of taxpayer is changed into: "The taxpayer is a person or entity, including personal tax payers, tax cutter and tax collector, who has the right and obligation of taxation in accordance with the provisions of the regulations."
While based on the income tax, the Taxpayer is the person or entity that meets the definition as the subject of the tax and receive or earn revenue which is the object of taxation. In other words, those two elements must be met to become tax payers and tax objects.
2. Subject of Taxpayer
The subject of taxpayer consist of three types, namely personal, the legacy has not been Split, and Permanent Establishment. The subject of Taxation is also distinguished into domestic and international tax. The domestic subject of taxation become taxpayer if they has earned revenue while international subject of taxation become a taxpayer if they earn revenue from Indonesia or obtained through a fixed business form in Indonesia. So the taxpayer is a private person or entity that has met the subjective and objective obligations.
3. Right and Obligation of Taxpayer
a. Rights of Taxpayer
The rights of taxpayer by law No. 28 of 2007 are as follows:
(37)
19 2) Submit statement of objections and appeals to taxpayer with
certain criteria.
3) Extend the term of submission of Annual Income Tax Notice for due date of two months by delivering a notice in writing or by other ways to the Director General of taxes (DJP).
4) Corrects the notice that has been delivered by passing a written statement, in the condition the Director General of Taxes (DJP) has not been doing the examination.
5) Apply for a refund of overpaid taxes
6) File an objection to the Directorate General of tax on a Tax Underpayment Assessment Letter, Additional Tax Underpayment Assessment Letter, Nil Tax Assessment Overpayment Assessment Letter, and cutting or tax collection by third parties based on the provisions of the legislation.
7) Apply for an appeal to the tax court on the decision letter of objection.
8) Appoint a person with special power of attorney to execute the rights and meet the obligations in accordance with the provisions of the regulations.
9) Obtain a reduction in or elimination of administrative sanction in the form of interest on the late payment of taxes cashdeficiency in terms of taxpayer conveyed the correction of the notice of the annual income tax before the tax year 2007, resulting in a tax that
(38)
20 should be paid become bigger and carried out within a period of one year after the enactment of law No. 28 of 2007.
b. Obligation of Taxpayer
The obligation of taxation as a state obligation, should be put in terms of the interests of the state. Interest of the state is closely related to the purpose and function of the obligation to pay taxes and other provisions supporting the tax payment order.
Table 2.1
The Obligation of Taxpayer
No Analysis Explanation
1 Taxpayer Register to obtain a Taxpayer Identification Number (NPWP).
2 Taxpayer Calculate, deposit and report tax payable, including obligation of collectors and tax cutter
3 Annual
Notification
Fill out an notification letter(SPT) clearly, completely and signed.
4 Bookkeeping Organize the bookkeeping or records Saving accounts for 5 years
5 Debt Payer Bore range due to the payment of VAT or tax debt, meaning we responsible to pay debt payable even though it behalf of our company 6 etc.
Source: Mardiasmo (2009:54)
C. Modernization System of Taxation Administration 1. Definition of Administration
According to the Dictionary of Indonesian (2005): "The Administration is 1) efforts and activities include goal setting as well as the determination of ways of organizing the construction of the organization; 2) efforts and activities related to implementation of policies
(39)
21 to achieve the objectives; 3) activities related to organizing the government; 4) office and administrative activities."
According to Trecker’s opinion (Rapina: 2011), administration is a process which is dynamic and sustainable, which is driven in order to achieve the goal by utilizing people and material through coordination and cooperation.
According to Liang Gie, administration means as a chain of activity done by a group of people in a cooperation to achieve an objective.
Another meaning of administration is all of activities having same substance, which is the existence of certain activity and people doing cooperation to achieve previous decided objectives.
From several meaning above, it can be concluded that the meaning of administration is all of chain of activities done by two or more people to achieve an objective by using certain facility and being able to achieve decided targets.
2. Administration of Taxation
According to Sophar Lumbantoruan (1997: 582) in Sri Rahayu and Ita (2009: 121), administration of taxation is all ways or procedures of the imposition and collection of taxes about role of taxation administration.
While according to Pandiangan (2008) in Sri Rahayu and Ita (2009: 121), stated that the administration of taxation is attempted to realize the rules of taxation, and the state revenue as mandated in APBN.
(40)
22 According to Gunadi (2009),"Administration of taxation is ordered to be dynamic in an effort to increase the effective implementation of taxation policy. Feasibility criteria of administration demands the new tax system to minimize administrative costs and compliance as well as make administration of taxation as part of the tax policy.” The two main tasks of reformation of taxation according to the Chaizi Nasucha is to achieve high effectiveness, that the ability to achieve a high level of compliance and efficiency with the ability to make the lowest administrative cost per unit tax receipt. The effectiveness and efficiency sometimes create a contradiction so that it is necessary the coordination, special measurement to increase the effectiveness and efficiency of taxation administration. In improving the effectiveness, it is used measurement: (1) voluntary tax compliance, (2) the principles of self-assessment, (3) provide information to the taxpayer, (4) speed in finding the problems associated with the notification letter(SPT) and payment, (5) improvement in supervision and control, (6) the appropriate sanctions. In improving the efficiency of tax administration, in particular, can be stimulated by: (1) provision of special units for large companies; (2) an increase in taxation for small taxpayer, (3) the use of banking services for tax levy, etc.
3. Reform of the Taxation Rules
One of the first reform of taxation part one is the reform in the field of taxation law. The result is the validation of Law No. 28 of 2007 about the General Provisions and Taxation Procedures Law and Law No. 36 of
(41)
23 2008 about taxable income (PPh) by the House of Representatives and the President which brought change in taxation in Indonesia. The main points of change in the tax law is still sticking on taxation principles universally embraced, namely justice, convenience/efficiency of the administration, as well as increase and optimization of the state revenue while maintaining self-assessment system. This amendment is one of the major steps undertaken to support the tax reform that is going on, so the Directorate General of Taxes, so it is expected, in the medium term or long term, can increase State revenue with the increase of voluntary compliance. There are 18 main points of change about General Provisions and Taxation Procedures Law, such as:
1) Provision regarding the taking, filling, signing and filing the notification letter (SPT) can be done by electronic media.
2) The deadline for the submission of notification letter (SPT) of income revenue tax which was previously at least for three months is turned into at least four months after the end of the tax year.
3) Administrative sanctions fines for taxpayer with their own accord revealed their injustice act after the examination but haven't done a follow up investigation, handed down from 200% to 150%.
4) Overdue determination of tax and overdue levy is shortened from ten years to five years since the end of the tax period, or a tax year.
5) In order to encourage the taxpayer to reveal the unreported income in notification letter (SPT) of taxable income before 2007, taxpayer are
(42)
24 given the opportunity to file the correction by being given the reduction or elimination of sanctions of administration, as long as the correction is performed on the first year of the enactment of this Law. 6) Due date till one year after the enactment of this Law, personal
taxpayer voluntarily register to obtain a tax identification number are given the removal of sanctions on tax administration, unless there are data or information state that notification letter (SPT) of taxpayer is incorrect or overpaid.
One form of tax reform in Indonesia is by being legalized of Law No. 36 of 2008 which was the fourth amendment of Law No. 7 of 1983 about income tax through a long process and involves a stake holder including entrepreneurs that reflects justice and equality of position between tax officer and Taxpayer. Decline in tariff, the emphasis of the cost of compliance, law enforcement more firmly to the wayward taxpayer, equality between tax officer and taxpayer are points in the tax reform law of income tax. Law No. 36 of 2008 was enacted in September 23, 2008 and publicly implemented in January 1, 2009.
Besides that, the change in tax reform 2008 which is involved in law No. 36 of 2008 about Fourth Amendment Law No. 7 of 1983 about income tax which is by imposing different tariff on individual taxpayer and corporate taxpayer. Expectedly with the new tax rate, then the corporate taxpayer will be benefited thereby revenues from taxpayer can be higher.
(43)
25
4. The History of Taxation Administration System
Since 1983, the Directorate General of Taxes has initiated to do reforms in the field of the administration of taxation to increase confidence of taxpayer by giving qualified services. It is characterized by a reform in the field of legislation by applying the self-assessment system and changes to the organizational structure that prioritizes service aspects to taxpayer, started with the changes of tax inspection Office to tax services office. To provide service and better supervision, Directorate General of Taxes needs adequate information technologies support. In line with the development of information technology and organization of Directorate General Taxes, information system of taxation, which is used since 1994, already inadequate to serve and supervise the taxpayer as a whole. Therefore, in the establishment of regional offices and tax service office for big taxpayer in 2002, the Taxation Information System is developed into an integrated tax administration system which has base on organization structure based on functions. In addition, there are still weaknesses in the reporting system of taxpayer that is manual reporting requires tax officer to perform repeated recording which is error-prone and requires no small amount of resources. Through the development of information technology, Directorate General of Taxes to develop several programs aimed to improve services to taxpayer in the form of e-SPT and e-Filing. In the system of taxation payment is also found some problems, such as counterfeiting of tax payment slip. To prevent this problem, Directorate
(44)
26 General of Taxes develops electronic payment system that is known as monitoring of tax payments report. Reform in the field of taxation administration is continuing and in 2001, Directorate General of Taxes propose reform program that can increase the trust of taxpayer to taxation system which is finally aimed to increase taxpayer compliance.
Modernizing itself covers 3 things, namely the reform of policy, administration and supervision:
a. Policy reform through amendments of the taxation law that is Law No. 28 of 2007 about the General Provisions and Taxation Procedures Law, Law No. 36 year 2008 about income tax, Value Added Tax Law and Indirect Taxes.
b. Administration Reform relates to organization, information technology and human resources. In the field of organization, it has made changes to the organizational structure based on each kind of services to be organization with structure based on functions by combining three offices (KPP, KPPBB and Karikpa) become the KPP Pratama. Besides KPP Pratama, there are KPP Madya in every regional office and 2 big Taxpayer KPP exists only in Jakarta. In addition there are special officials called account representative which oversees and serve taxpayer.
c. Information technology reforms. The concept is full automation, ons a paperless internal administration, efficiency, customer oriented and built-in control functions. It aims to reduce direct contact with
(45)
27 taxpayer so that it ease the taxpayer to fullfill their tax obligation economically, efficiently, effectively, and accurately by the existence of built-in control system. The reform of the supervision is done through:
1) Code of Conduct Commission. The code of conduct expressly includes the obligation and the prohibition for employees, including the application of strict sanctions. In addition, it is formed two Sub Directorate that handle internal oversight to the implementation of the code of ethics.
2) National Data Bank. The plan serves as the center of archives containing data storage of taxpayer all over Indonesia.
3) Complain channel as a way to ease taxpayer in conveying problems and complaint.
5. Reform of the Taxation Administration System
Tax reform is a fundamental change in all aspects of taxation. Tax reform which become the priority regarding to the modernization of the tax administration of the medium-term (three to six years) with the purpose of achievement for, the high level of voluntary compliance, confidence in the tax administration, and high productivity of tax officer, Anggito Abimayu (2003) in Rapina, Jerry and Yenni (2011: 8).
The other purposes of the reform of the administration is to improve administration and anticipate improvements to achieve better results. The motivation of doing tax reform to finance state expenditure.
(46)
28 The definition of administrative reform is extensive due to the wide range of activities involved in it.
Since 2002, Directorate General of Taxes (DJP) has launched the change program or the reform of the administration of taxation which is briefly referred to the modernization. The soul of the program is the implementation of good governance, namely the application of the tax administration system that is transparent and accountable, by using the technology information system which is reliable and up-to-date.
According to Liberti Pandiangan (2008: 64) modernization of carried out taxation is part of a grand design of comprehensive tax reform. As being targeted since 2002, that tax reform in a comprehensive manner is made into three main areas which is directly touch the pillar of taxation, namely:
1) Administration field, which is through the modernization of tax administration
Through the modernization of the taxation administration, it is expected to create the pillars of good and strong national taxation management as a good and sustainable fundamental of state revenue. In this case, the management of taxation is basically not avoid to the views, opinions, or critics from various external parties. The Directorate General of Taxes try to be transparent and make it as input in setting up and building a good and modern taxation management system.
(47)
29 2) Regulation field, by making amendments to the Taxation Law
From taxation law aspects, it keeps try to create and develop juridical formality and material of taxation. It can be done by making adjustment and regulation regarding to the current developments in life of society, state, or economic activity. The reason is a rule, basically, should be able to follow and being followed by the life of society, state, and stakeholders. If not, then the regulation could be a barrier even contradictory, so that the achievement of the targets can be incompatible with what is expected.
3) Supervision field, creating bank of data of the national taxation
In the field of supervision, it is built a national data bank of taxation as an effort to revitalize the implementation of self-assessment system with the official assessment in the calculation and determination of the magnitude of the tax payable, as provided for in the taxation law. In addition, the construction of data bank of national taxation is also aimed to undertake extensification and intensification activities of taxation. Through the activities of extensification, based on data and information that it is ordered for people who has been qualified to register as a Taxpayer to obtain a Tax Identification Number. For personal subject, the limit is for those who have obtained the above nontaxable income either already married or not married. After the society know this appeal, and apparently people have not enrolled themselves as Taxpayer correlating with self-assessment
(48)
30 system, to make it balance, so it publish officially Tax Identification Number (official assessment). Through extensification, the expansion of the tax base in which there is the increase the number of taxpayer, especially personal taxpayer. Under such conditions, it does intensification activities to realize aspect of justice. Along with that, the intensification of activities carried out various efforts of activity. One of those through the optimization of the taxation data utilization model (OPDP).
According to the Summer, Linn and Archarya quoted by Marcus (2005: 15), the reason to commit tax reform are:
1) As part of the structural adjustment, tax reform is used to reduce the distortion of economic stimulation and the occurrence of the deficiency and inequity in the allocation of resources.
2) As part of efforts to stabilize the economy, tax reform, together with state expenditure cutting, at the same time to generate revenue in a rational without distortion, fair and sustainable.
According to the Bird and Jantscher quoted by Marcus Gale (2005: 15), tax policy changes without being supported by the tax changes is not meaningful. Changes in the field of taxation must be in line with its administrative capacity, because the administration of taxation is a policy in the field of taxation which has inseparable relationship.
(49)
31
Table 2.2
Differences between the Old system and the New System
OLD SYSTEM NEW SYSTEM
Tax office organization structure is formed by type of tax, there is no clear separation of functions because it is implemented in one section according to type of tax
Organization of modern tax service office is formed by a function which leads to improved services to the public / taxpayer of all types of taxes.
Monitoring and services function have not been effective due to lack of specialized staff to perform these functions.
The existence of supporting specialized staff or selected AR service, and work professionally as services and supervision to the taxpayer.
Inspection management because it is in two units of the tax inspection so that coordination is not good.
Inspection management is more efficient and effective because it is in one unit of the human resources unit specialized in certain sectors so that coordination function is better. Taxpayer do their taxation
obligation in the form of payment and manual reporting by using the hard copy so that it is less practical
Utilization in development and advances information technology. The facilities include: website, call center, complaint center, filing, e-SPT, online payment.
Process of Execution of the work for the service of process, supervision, and inspection of the less efficient and far too bureaucratic, so that the relative high cost of compliance.
The process of implementation of the work less efficient and reduce bureaucracy so that cost of compliance is relatively low. With existence of AR, the handling of various aspects of taxation will be monitored more quickly.
Source: Iklima Pila Sopia (2008)
D. Dimension of Application of Modernization of Taxation Administration System
The application of modern taxation administration system through programs and activities in the framework of the reform of the middle-term tax
(50)
32 administration is explained in the dimensions of Modern Taxation Administration System as follow:
1. The Organizational Structure
Organizational structure is the element that relates to the role of the patterns that have been determined and the relationships between roles, allocation of activities to subunits-separate, the distribution of authority between administrative positions, and formal communication network. (Abdul Rahman:2010:213).
a. Establishment of the Organization by Function
As a manifestation of revamping in the function of services, supervision and inspection, organizational structure which is based on the decision of the Minister of Finance No. 443/KMK. 01/2001 is drawn up according to the type of tax, where income tax and others (VAT or other indirect taxes) served in tax office, while the Land and building Tax and the Fees for Acquisition of Rights to Lands and Buildings (BPHTB) served by a of Land and Building Tax Services Office.
By implementing the modern taxation administration system, organizational structure is designed with paradigm based on clear separation of functions between regional offices and tax offices, where tax offices are responsible to carry out the functions of the services, supervision, billing and inspection, while the regional offices are
(51)
33 responsible to carry out the function of supervision of tax offices operational activities, objection and appeal, and investigation.
b. Specification of Duty and Responsibility
In the organizational structure, there is specification of duty and responsibility, such as:
1) Account Representative. The appointment of an Accounts Representative is special to serve and oversee fulfillment of taxation obligations of taxpayer directly. With the distribution of tasks adjusted to the business group of taxpayer, Account Representative is responsible for providing answers to any questions asked by taxpayer effectively and professionally, especially on taxpayer's Account for all types of taxes, the progress of the inspection process and restitution, interpretation and the affirmation of a rule, the changes of data of the taxpayer’ identity, the action of tax billing and examination, progress of process on objection and appeals, changes of regulation relating to the taxation obligation of the taxpayer.
2) Examination of tax is only conducted by functional examiner with the allocation of functional examiner is adjusted to the level of examination risk and conducted technical training which supports professionalism of examiner according to the of the business group of taxpayer.
(52)
34 3) Specialty of other employees such as tax executor and information
technology programmer.
c. Completing and Perfecting the Taxation Information System Implementation into an Integrated Taxation Administration System
Taxation Information system (SIP) is developed into an Integrated Taxation Administration System (SAPT) controlled by the case management in the process of monitoring systems of taxation administration refers to the automation of the office include services, sequencing supervision, supervision of executor and reporting designed in accordance with the current legislation .
d. Routine monitoring through a Taxpayer's account
Transparency of services and fulfillment of taxation obligations of Taxpayer are supported with the Taxpayer's Account that serves to record automatically any changes that occur to the rights and obligations, objections, balance transfer, notification letter, and other tax documents so that it eases to oversight of taxation rights and obligations for each of the taxpayer.
e. The Mechanism of supervision of services and examination
Setting standard performance and taxation services, implementing a code of ethics for Civil Servants of tax officer and the establishment of Code of Ethic Committee as well as cooperation with National Ombudsmen Committee will complete the set of surveillance for service and inspection.
(53)
35
2. The Organizational Procedures
Organization procedures relates to process of communications, decision making, achievement selection, socialization and career. Discussion and an understanding of organizational procedures are based on the activity of the organization that is conducted regularly. (Abdul Rahman:2010:213).
a. One Door Services of Account Representative
The appointment of the Account Representative which is responsible specifically to serve and supervise the taxation administration of some Taxpayer by developing the concept of one door services so that it can reduce the critical interface between Taxpayer with a tax officer who likely can lead to negative excesses. Account Representative also handles exemption certificate, tax deposit balance transfer, ruling and publishing legal product.
b. Simplification of administrative procedures and improvement of the standards of time and quality of service and tax inspection
Activities performed include: (i) simplifying the notification letter(SPT), (ii) accelerate the process of resolving the objections and appeals of tax products, (iii) reinforcement of the Taxpayer, (iv) review the criteria of levied taxpayer to reduce he request for restitution, (v) reviewing the obligation of inspection upon each Annual Tax Overpayment Letter (SPT LB) and speed up the restitution
(54)
36 of the Annual Tax Overpayment Letter (SPT LB) that is at low risk, (vi) the centralization of value added tax (VAT).
c. Support of modern information technology in providing services, supervision, inspection and collection of taxes, among other things:
Integrated Taxation System Administration (SAPT) with integrated functions of administrative procedures and approaches that have been arranged in case management and workflow system supported system, especially payment, SPT, Registration, e-Filing, e-Counseling, complaint center that helps speed, accuracy and security of process data security administration taxation of mandatory tax obligation fulfillment.
3. The Organizational Strategy
The organizational strategy is seen as a tactic, point of view, and response that aim to take advantage in all conditions, factors, opportunities, and resources, so that objectives of the organization can be achieved successfully and happily. Strategy is developing from time to time as the meaningful flow pattern of decision. (Abdul Rahman:2010:213).
a. Conscious and Care Tax Campaign
Campaigns and socialization of taxation as part of good governance framework through various parties, such as universities, religious figures, and also through media, portal websites, as well as
(55)
37 the installation of billboards in strategic location and improve the performance of extension as information services and public relation. b. Simplification of Administration of Taxation
Information technology support accelerating the process of services and investigation in which the database is developed in the online network will probably allow the acceleration of information access and also reporting services of Notification letter (SPT) and payment of taxes can reduce online administrative cost and compliance cost.
4. The Organizational Culture
Organizational culture is defined as a system of dissemination of belief and values developed in the organization and steer the behavior of its members. Organizational culture represents the common perception held by members of the organization. (Abdul Rahman:2010:213).
Some of the activities of the modernization of organizational culture, namely:
a. Clear and authoritative governance implementation program, Clean and authoritative governance (good governance) is characterized by the existence of a code of ethics of employees in Directorate General of Taxes based on the decision of the Minister of Finance No. 384/KMK. 03/2002 of 27 August 2002, the existence of code of conduct Directorate General of Taxes Committee based on the decision of the Minister of Finance No. 226/KMK. 03/2002 of 14 May
(56)
38 2002, the existence of Taxation and Customs and Excise Division at National Ombudsman Committee, any cooperation with the Inspectorate-General of the Department of finance and internal consolidation.
b. Apply the code of conduct to all employees in Directorate General of Taxes, the establishment of a code of conduct Committee, increase the effectiveness of supervision by the Inspectorate-General of the Department of finance and cooperation with the National Ombudsman Commission.
E. Taxpayer compliance
1. Definition of Compliance
Quoted from Desi Handayani, taxpayer compliance can be defined as a situation where taxpayer fulfill their taxation obligations and obtain their taxation rights.
According to Kiryanto in Supriyati (2012:7), taxpayer compliance is defined as the behaviour of taxpayer who enter and report the required information in time, fill out correctly the amount of taxes owed, and pay taxes on time, in the absence of coercive action. Non compliance occurs when one of the conditions of the definition are not met.
Quoted from Desi Handayani, there are two kinds of compliance, namely formal compliance and material compliance. Formal compliance is a situation where taxpayer comply with tax obligations in accordance with
(57)
39 a formal provision in the taxation laws. While the material compliance is a situation where taxpayer substantively meets all material provisions of the taxation. Material compliance may include formal compliance.
From several explanations that have described above, it can be concluded that the taxpayer compliance is compliance fulfill all taxation laws, such as taxpayer compliance in registering, compliance in reporting, compliance in the calculation and payment of payable taxes as well as taxpayer compliance in the payment of arrear of payable taxes.
2. The Factors That Affect Taxpayer compliance
According to Franzoni in Banu (2008) taxpayer compliance can be seen from several perspectives and it is influenced by several factors: (1) their tendency ons public institutions (in this case the Directorate General of taxes); (2) a justice who is felt by taxpayer from the existing system; and opportunity over the possibility of detected violation and punished in accordance with the existing legislation.
Meanwhile, according to Eliyani in Lasnofa (2010) level of compliance is affected by several factors, namely the condition of a country's tax administration system, service on the taxpayer, tax law enforcement, inspection of the taxes and tax rates. Awareness and compliance to meet the obligation of taxation also depends on the willingness of the taxpayer, to the extent that taxpayer will comply with the provisions of the legislation.
(58)
40
3. Criteria of Taxpayer compliance
According to the Decree of Minister of Finance no.
544/KMK.04/2000, about taxpayer’s criteria that can be given the
preliminary tax overpayment as changed with the decree of Minister of
Finance no. 235/KMK.03/2003, that taxpayer’s criteria are as follow:
a. Timely in delivering notification letter for all kinds of tax in the last two years
b. In the last year of lately periodic tax form delivery is not more than 3 periods of tax and not for each kinds of tax and not in a row
c. The lately periodic tax form is not delivered more than due date of the next periodic tax form.
d. Does not have tax arrears for all kinds of tax, except already received the permission for postponing the tax payment, not including for the tax arrears related with the annual tax form released for the last two year of tax period.
e. Has not been ever punished caused by doing criminal action in the area of taxation over 10 years.
f. The audited financial statement done by public accounting firm or Development and Financial Supervisory Board must have unqualified opinion or unqualified with explanation as long as the explanation does not influence the fiscal profit and loss. Audited report must be composed widely, presenting reconciliation of commercial and fiscal profit and loss.
(59)
41 If the financial statement is not audited by public accounting firm, then the taxpayer should file written request at least 3 months before the end of book period in order to be decided as compliant taxpayer added by requirement of doing bookkeeping for the last 2 years and the taxpayer have been done tax audit.
Compliant taxpayer is a taxpayer who comply, fulfill and do all the taxation obligation according to the provision of taxation law and applied regulation. The title of compliant taxpayer contains the meaning of discipline and compliance that is not same with the taxpayer who has the title as the big taxpayer. Because the big taxpayer does not necessarily meet the criteria as compliant taxpayer although it give the big contribution for the state if they still have arrears, delayed payment and tax report.
F. Previous Research
The research is based on research conducted by Marcus Sofyan (2005)
titled “The influence of the implementation of modern taxation administration
system on taxpayer compliance in KPP in the area of Directorate General of
Taxes”. Abdul Rahman (2009) titled “Correlation Modernization
Administration System of Taxation with Taxpayer compliance”. Sri Rahayu (2009) titled "The Influence of The Application of Taxation Adminsitration System on Taxpayer compliance in Tax Service Office (KPP) Pratama Bandung" X ".
(60)
42 Lasnofa and Fauzan (2010) with the title "Modernization of Modern Taxation Administration Systems on The Levels of Taxable Enterprise Compliance in Tax Service Office Pratama Padang". Rapina, Jerry and Yenni (2011) with the title "The Influence Of The Application Of Modern Taxation Administration System On Taxpayer compliance”. And Supriyati, with the
title “The Impact of Motivation and Knowledge of Taxation to Taxpayer
Compliance” Can be seen in table 2.4 below:
Table 2.3 Previous Research No Researcher
(Year) Title
Dependent Variable
Independent Variable
Research Results
1 Sofyan (2005) Pengaruh penerapan sistem administrasi perpajakan modern terhadap
kepatuhan wajib pajak pada KPP di lingkungan wilayah Direktorat Jendral Pajak Taxpayer compliance Organizational Structure, Organizational Procedure, Organizational Strategy, and Organizational Culture
The results of this research suggests that there is a positive influence in modern tax administration system on taxpayer compliance, which includes variable of organizational structure, organizational procedures, organizational
strategy and
organizational culture.
2 Abdul
Rahman (2009) Hubungan Modernisasi Administrasi Sistem Perpajakan dengan Kepatuhan Wajib Pajak Taxpayer compliance Organizational structure, organizational procedure, organizational strategy, organizational culture
The result of the research shows that there is correlation between modern tax administration
system and
taxpayer’s
compliance as
(61)
43
No Researcher
(Year) Title
Dependent Variable
Independent Variable
Research Results
This indicated that
modern tax
administration system
significantly
correlated to
taxpayer’s compliance. 3 Sri Rahayu
(2009) Pengaruh Penerapan Sistem Administrasi Perpajakan Modern terhadap Kepatuhan Wajib Pajak
pada KPP
Pratama Bandung
Taxpayer compliance
Organizational Structure, The Changing of Service
Implementation, Service
Facilities using Information Technology, Employee Code of Ethics
The results of this research suggested that there is a positive influence in modern taxation administration
systems on
taxpayer compliance.
4 Lasnofa and Fauzan (2010) Pengaruh Modernisasi Sistem Administrasi Perpajakan Modern terhadap Tingkat Kepatuhan Pengusaha Kena Pajak di KPP Pratama Padang
The
compliance
rates of
business entity (PKP)
Organizational Structure, Service
Implementation
of Taxable
business entity (PKP),
Organizational Strategy and Organizational Culture
Administrative system of taxation impact
significantly to compliances of taxable enterprise level. The research also showed that
the level of
compliance by
taxpayer to register and pay higher taxes in arrears
compared with
compliance in the payment and tax reporting.
(1)
Taxpayer Compliance (Y)
Case Processing Summary
N %
Cases
Valid 86 100.0 Excludeda 0 .0 Total 86 100.0 a. Listwise deletion based on all variables in the procedure.
Reliability Statistics
Cronbach's Alpha N of Items
.749 6
Item Statistics
Mean Std. Deviation N
KWP1 4.15 .660 86
KWP2 4.06 .675 86
KWP3 4.07 .699 86
KWP4 4.14 .706 86
KWP5 4.10 .532 86
KWP6 4.00 .686 86
Item-Total Statistics Scale Mean if Item Deleted
Scale Variance if Item Deleted
Corrected Item-Total Correlation
Cronbach's Alpha if Item Deleted
KWP1 20.37 4.919 .564 .692
KWP2 20.47 5.169 .450 .724
KWP3 20.45 4.910 .518 .704
KWP4 20.38 5.063 .455 .723
KWP5 20.42 5.587 .451 .725
KWP6 20.52 5.005 .498 .710
Scale Statistics
Mean Variance Std. Deviation N of Items 24.52 7.005 2.647 6
(2)
132
Appendix 4: Result of Multiple Regression
Descriptive Statistics
N Minimum Maximum Mean Std. Deviation
ST 86 12 20 16.01 2.128
PO 86 27 45 37.08 3.605
SO 86 21 35 29.00 2.866
BO 86 21 35 28.45 3.176
KWP 86 18 30 24.52 2.647
Valid N (listwise) 86
Correlations
KWP ST PO SO BO
Pearson Correlation
KWP 1.000 .632 .729 .619 .653
ST .632 1.000 .682 .469 .438
PO .729 .682 1.000 .576 .620
SO .619 .469 .576 1.000 .593
BO .653 .438 .620 .593 1.000
Sig. (1-tailed)
KWP . .000 .000 .000 .000
ST .000 . .000 .000 .000
PO .000 .000 . .000 .000
SO .000 .000 .000 . .000
BO .000 .000 .000 .000 .
N
KWP 86 86 86 86 86
ST 86 86 86 86 86
PO 86 86 86 86 86
SO 86 86 86 86 86
BO 86 86 86 86 86
Model Summaryb
Model R R Square Adjusted R Square Std. Error of the Estimate
Durbin-Watson
1 .805a .648 .631 1.609 2.031
a. Predictors: (Constant), BO, ST, SO, PO b. Dependent Variable: KWP
ANOVAa
Model Sum of Squares Df Mean Square F Sig.
1
Regression 385.865 4 96.466 37.282 .000b Residual 209.588 81 2.588
Total 595.453 85 a. Dependent Variable: KWP
(3)
Coefficientsa
Model Unstandardized Coefficients
Standardized Coefficients
t Sig. Collinearity Statistics
B Std. Error Beta Tolerance VIF
1
(Constant) .620 2.030 .305 .761
ST .271 .113 .218 2.398 .019 .526 1.902
PO .234 .078 .319 3.020 .003 .389 2.568
SO .170 .081 .184 2.105 .038 .568 1.760
BO .209 .075 .251 2.775 .007 .532 1.879
(4)
(5)
KEMENTERIAN KEUANGAN
REPUBLIK INDONESIA
DI
REKTORAT
JENDERAL PAJAK
KANTOR WILAYAH
DJP
JAKARTA
PUSAT
JAI.AN JENOEML GATOT SUBROTO I(AV. 40 .42, JAI(ARTA 12190 TELEPON (021) 5250208,5262880; FAKSIMILE (021) 5736066. SITUS www.pajak.go.idLAYANAN |NFORMASI DAN KELUHAN KRTNG PAJAK (021) 500200
Nomor
Sifat
Lampiran
Hal
S
- tl'{
A/VPJ.06/8D.05/2013
Biasa
Pemberian
lzin
Riset
l,
Februari 2013
I
--.-_l
Desember 2012
hal
I
Yth.
Universitas lslam
Negeri
Syarif
Hidayatullah Jakarta
Jalan lr.
H.
Juanda
No. 95,
Ciputat 15412
Sehubungan dengan
surat
Permohonan lzin
Riset atas:
Saudara
nomor:
UnO1/F8/KP.01.212012 tanggal
Nama
NIM
/
NPM
:
Evie
Trie
Hardiani
:
109082100022
dengan ini
Kantor
Wilayah
DJP
Jakarta
Pusat
memberikan
izin kepada mahasiswa
yang
bersangkutan
untuk
magang/penyebaran kuesioner/penelitan
dan/atau
riset pada KPP
Pratama
Jakarta
Senen, sepanjang
bahan-bahan keterangan/data
yang
didapat hanya digunakan
untuk
keperluan
akademis,
tidak
untuk
dipublikasikan,
dan tidak
menyangkut rahasia jabatan/Negara
sebagaimana
diatur
dalam
ketentuan
Pasal
34
Undang-undang
Nomor
6
Tahun
1983
tentang
Ketentuan Umum
dan Tata Cara
Perpajakan sebagaimana
telah
diubah terakhir
dengan
Undang-undang
Nomor
16
Tahun
2009.
Selanjutnya
setelah selesai
melaksanakan riset/penelitiannya,
agar
kepada
mahasiswa
yang
bersangkutan diminta untuk memberikan
satu soft-copy
hasil riset/penelitian tersebut sebagai
bahan
masukan
bagi
Direktorat Jenderal Pajak,
Soft-copy
dimaksud dapat
dikirim
melalui
ke
alamat
sebagai
berikut: perpustakaan@paiakJp.
id.
Demikian, agar dapat digunakan
sebagaimana
mestinya.
a.n.
Kepala Kanwil DJP
Pjs.
Kepala Bidang
P2
Humas
W!
Binsri
g
(6)