The ruling hearing for the material judicial review of Law No. 14 of 2022 on the Tax Court, Thursday (5/25/2023). Photo by Humas MK/Ifa.
JAKARTA (MKRI) — The tax court is part of the judicial power as regulated in Article 24 of the 1945 Constitution, so it is within the judicatures under the Supreme Court, the Constitutional Court (MK) asserted in its legal considerations for Decision No. 26/PUU-XXI/2023, read out at a ruling hearing on Thursday, May 25, 2023 in the plenary courtroom. The petition was filed by Nurhidayat, an advocate specializing in taxation, lecturer Allan Fatchan Gani Wardhana, and Yuniar Riza Hakiki, secretary-general of the Center for Constitutional Law Studies of the Law Faculty of the Islamic University of Indonesia (UII).
The Court dismissed the petition by Petitioner II while granted part of the petition by Petitioners I and III. “[The Court] declares the phrase ‘Ministry of Finance’ in Article 5 paragraph (2) of Law No. 14 of 2022 on the Tax Court (State Gazette No. 27 of 2002, Supplement to State Gazette No. 4189) unconstitutional and not legally binding if not interpreted as ‘the Supreme Court’ to be gradually implemented no later than December 31, 2026, so that Article 5 paragraph (2) of Law No. 14 of 2022 will read in full, ‘Organizational, administrative, and financial fostering for the Tax Court shall be carried out by the Supreme Court, which is gradually implemented no later than December 31, 2026,’” said Chief Justice Anwar Usman alongside the other eight constitutional justices.
In its legal considerations delivered by Constitutional Justice Wahiduddin Adams, the Court argued about the legal fact of dualism in the authority of fostering in the tax court. This is mixing up the fostering of judicial institutions that should be integrated into one institution that carries out the function of judicial power and is free from the interference of the executive or other power.
“Fostering universally means providing guidance both judicially and non-judicially, where both could potentially overlap because they cannot be separated from one another and are an integral pillar of the independence of the judiciary,” the Court asserted.
Furthermore, Justice Wahiduddin continued, continuing to maintain the fostering of the judiciary in non-integrated institutions could affect the independence of the judiciary or at least potentially allow other institutions to control the implementation of the duties and authority of the judiciary in casu the tax court, even though it is only related to organization, administration, and finances. However, this shows that the tax court cannot optimally carry out its duties and authorities independently. Moreover, in the perspective of the rule of law, the judicial system and law enforcement processes to provide justice and legal certainty for justice seekers are a fundamental element in strengthening the position of the judiciary. It is an integral implementation of the concept of a state of law that aspires to the rule of law and fair law enforcement.
Independent Judiciary
Justice Suhartoyo added that without independence in the judiciary, judicial bodies could still potentially be influenced by government or executive power. This further allows for abuse of power or arbitrariness in government, including the neglect of human rights/constitutional rights of citizens by the authorities, due to the absence of the independence of the judiciary.
“The independence of the judiciary has been clearly regulated in Article 24 paragraph (1) of the 1945 Constitution, which stipulates that judicial power is an independent power to administer justice in order to uphold law and justice. Thus, the purpose of an independent judicial power, or in this case judicial independence, is to uphold law and justice for the people,” Justice Suhartoyo explained.
He added that judicial independence is an inseparable element and has become the nature of judicial power. Judicial power in Indonesia is exercised by a Supreme Court and the judicial bodies under it within the scope of the general court, religious court, military court, and state administrative court, and also by a Constitutional Court.
“The judicial body, in this case the tax court, was actually formed as a continuation of the existence of the Tax Dispute Resolution Body based on Law No. 14 of 2002, where this law has several specificities if the tax court is compared to other courts in the judicial system in Indonesia,” he said.
Justice Suhartoyo added that after the enactment of Law No. 14 of 2002, there were changes in the judicial system based on the amendment to the 1945 Constitution and the amendment to Law No. 48 of 2009, including the provisions regarding special courts and their relationship with the judicatures under the Supreme Court. Since 2004, there have only been 4 recognized judicatures in Indonesia: the general court, religious court, state administrative court, and military court. Thus, a special court can only be established within and attached to one of these courts. Thus, since then the tax court has been categorized as a special court included in the state administrative judicature under the Supreme Court.
“Thus, based on the entire elaboration of the legal considerations and referring to the fact that the Constitutional Court’s decision has not been followed up to date, the Court concludes that it is legally reasonable in the decision of the a quo case to determine a definite period of time for the legislatures, not just recommendations as in the Court’s previous decisions,” Justice Suhartoyo said.
December 31, 2026
In this regard, Justice Suhartoyo asserted, it is important for the Court to determine this by ordering that December 31, 2026 be a fair and rational deadline to unite the authority to foster the tax court under one roof under the Supreme Court. Therefore, since the decision on the a quo case was pronounced, stakeholders should gradually and immediately prepare regulations related to all legal needs, including procedural law for improving the professionalism of the tax court’s personnel, as well as other matters related to the integration of authority under the Supreme Court. Thus, no later than December 31, 2026, the fostering of the tax court is under the Supreme Court.
“In addition, it has been found that the provisions of Article 5 paragraph (2) of Law No. 14 of 2002 have caused legal uncertainty and injustice as argued by the Petitioners, but because the interpretation requested by the Petitioners in their petition is different from the Court’s interpretation as stated in the decision of the a quo case, the Petitioners’ petition is reasonable according to the law in part,” the Court emphasized.
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At the preliminary hearing, the Petitioner explained that the requirements for legal counsels in the tax court are regulated in Article 34 of the Tax Court. These requirements are a special appointment letter, Indonesian citizenship, expansive knowledge and expertise in taxation law. However, Article 34 paragraph (2) letter c of the Tax Court stipulates that there are other requirements set by the Minister of Finance.
The Petitioner believed this to be the impact of the Minister of Finance’s authority to foster the organization and administration of the Tax Court as stipulated in Article 5 paragraph (2) of the Tax Court Law. Consequently, the Minister of Finance’s authority to regulate the advocate profession can hinder the Petitioner, who met the requirements to become a legal representative in the tax court. The Petitioner felt disadvantaged in carrying out his duties and profession to fight for the interests of clients because the tax court was still under the control of the executive.
Therefore, in the petitum, the Petitioner requested that the Court declare Article 5 paragraph (2) of the Tax Court Law along the phrase “Ministry of Finance” conditionally unconstitutional and not legally binding if not interpreted as “the Supreme Court.” As such, the article should read, “Organizational, administrative, and financial fostering of the Tax Court is conducted by the Supreme Court.”
Author : Utami Argawati
Editor : Lulu Anjarsari P.
PR : M. Halim
Translator : Yuniar Widiastuti (NL)
Disclaimer: The original version of the news is in Indonesian. In case of any differences between the English and the Indonesian versions, the Indonesian version will prevail.
Thursday, May 25, 2023 | 17:27 WIB 474