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Removing the Middleman from Bali's Tax Equation

Governor Made Pastika Threatens to Compel On-line Hotel and Restaurant Tax Collection in Bali.

(8/21/2010) According to Radar Bali, malfeasance and manipulation in the collection and payment of Bali's hotel and restaurant tax in the various regencies and cities has become an embarrassing public secret.

To end what is presumed to be a massive underpayment of tax liabilities by many of Bali's hotels and restaurants, governor Made Mangku Pastika has been a steadfast proponent of an on-line system of tax collection.

Recent complaints from tourism committee delegates to the Bali House of Representatives (DPR-Bali), has prompted the governor to renew his demand for an acceleration of the introduction of an on-line hotel and restaurant (PHR) tax system.

Pastika warned that if regencies and cities refused to implement the new on-line tax collection system, provincial officials would not hesitate to take control of a collection process now delegated to regional officials. Pastika complained: "The plan was to introduce this program last year. The provincial government will soon put vehicle licensing and registration on-line."

The governor expressed his disappointment that promises made to implement an on-line PHR collection system remain unfulfilled. He roundly condemned the regents and mayor who, on the one hand, have freely admitted the need to introduce an on-line PHR payment system to reduce financial leaks while, on the other hand, have offered no viable explanation for their failure to comply with the governor's directive to go on-line.

Pastika warned: "If they continue to refuse, we will take over the collection of PHR. Such a step is authorized under the law." Pastika said that taxation remains the dominant role of the provinceand, as such, provides for the system to be assumed by the provincial government, if required.