Ahmad Sofian, an expert for the Government, testifying at the judicial review hearing of Law No. 7 of 2021 on the Harmonization of Taxation Regulations, Tuesday (11/7/2023). Photo by MKRI/Ifa.
JAKARTA (MKRI) — Zainal Arifin Mochtar from Gadjah Mada University and Ahmad Sofian from Bina Nusantara University (BINUS) testified as experts for the President/Government at a material judicial review hearing of Law No. 7 of 2021 on the Harmonization of Taxation Regulations (HPP Law) on Tuesday, November 7, 2023. For the case No. 83/PUU-XXI/2023, filed by Surianingsih and PT Putra Indah Jaya, Zainal said that tax laws often overlaps with other types of laws, given its administrative nature. It is also frequently referred to as administrative law where criminal charges are imposed in order to implement provisions contained within. This includes Article 43A of the HPP Law, which regulates the criminal provisions detailing the procedure for investigating preliminary evidence of criminal offenses. In other words, he added, the HPP Law plays both a material role similar to the criminal code (KUHP) by imposing criminal punishments and a formal role similar to the criminal procedure code (KUHAP) by assessing preliminary evidence of criminal activities in taxation.
Zainal explained that based on constitutional law, HPP Law is said to have special characteristics that are more lex specialis systematis with three parameters: the legal provisions regulated in the subject matter of the law are different from legal provisions in general; they regulate the provisions of material and formal criminal law but are different from legal provisions in general; and the subject and/or legal addressee regulated in the law is very particular.
“Therefore, the HPP Law, which contains taxation criminal provisions has fulfilled the qualification as a law that is special and systematic. So, the Regulation of the Minister of Finance No. 177/PMK/03/2022 as a delegation regulation on the procedure for the examination of preliminary evidence of criminal acts in the field of taxation is in line with the nature of tax criminal law because it can be seen as ius singulare or lex specialis systematis, with its own system of norms and sanctions. It is due to the very special characteristics of tax criminal law that are different from legal provisions in general,” he said before the hearing presided over by Deputy Chief Justice Saldi Isra and six other constitutional justices.
Examination of Non-Pretrial Evidence
At the hearing, Ahmad Sofian conveyed his thoughts on petition No. 83/PUU-XXI/2023 on the pretrial of tax crimes. In the effort to enforce tax administrative law, if it runs ineffectively, such as the taxpayer (WP) is unwilling or unable to pay, it cannot continue to criminal process. This is because such an administrative dispute should be resolved in the tax court.
Tax crimes begins with an indication of tax crime based on complaint report information data (IDLP), followed by examination of preliminary evidence. This can be terminated, however, if the taxpayer admits violation and pays the principal plus a 150% fine, as specified in Article 8 paragraph (3) of the Law on General Provisions and Procedures of Taxation (KUP Law). However, Sofian said, if an investigation has taken place and the taxpayer wishes to pay for the tax, they may do so using the instrument described in Article 44B of the KUP Law.
Furthermore, if a tax crime that harms state financial revenues is found, Sofian asserted, pretrial on the examination of preliminary evidence cannot be conducted because it serves to filter the presence or absence of such a crime. Thus, filtering is important to ensure the authority of civil servant investigators (PPNS) to take the next step.
The examination of preliminary evidence, which has the same purpose as an investigation, should not be the object of pretrial. This will cause a chaos in the formal criminal law, because all criminal investigations, both those carried out by the Police and PPNS investigators, can be processed in a pretrial, resulting in the elimination of the purpose of the pretrial Institution itself,” he said.
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The Petitioners challenges the phrase “examination of the preliminary evidence prior to a criminal investigation” in Article 43A paragraph (1) in Article 2 point 13 and of the HPP Law and the phrase “procedures for examination of preliminary evidence of criminal offense in the field of taxation” Article 43A paragraph (4) in Article 2 point 13.
Article 43A paragraph (1) of the HPP Law reads, “Based on information, data, reports, and complaints, the Director General of Taxation shall be authorized to conduct an examination of the preliminary evidence prior to a criminal investigation in the field of taxation.”
Article 43A paragraph (4) of the HPP Law reads, “Procedures for examination of preliminary evidence of criminal offense in the field of taxation as referred to in paragraph (1) and paragraph (2) shall be regulated by or based on the Regulation of the Minister of Finance.”
At the preliminary hearing on Monday, August 28, legal counsel Cuaca said those articles were in violation of Article 1 paragraph (3) and Article 28D paragraph (1) of the 1945 Constitution. He revealed a concrete case where in an examination of preliminary evidence of a tax crime, the house of Petitioner I was sealed off and searched by civil service investigators (PPNS), which could not be challenged through pretrial in both the district court and the state administrative court (PTUN). This is because the letters issued for preliminary evidence examination are related to criminal law enforcement, which are not within the state administrative court’s jurisdiction.
The Petitioners believe this to be a reflection of legal imbalance and lack of protection of human rights for taxpayers who is examined for preliminary evidence of tax crimes. In addition, there are different court rulings on pretrial motions relating to the examination of preliminary evidence of tax crimes.
In the petitum, the Petitioners request that the Court declare the phrase “examination of the preliminary evidence prior to a criminal investigation” in the amendment to Article 43A paragraph (1) in Article 2 point 13 on the HPP Law conditionally unconstitutional and not legally binding if not interpreted as “To the following acts during the examination of the preliminary evidence of criminal offenses in taxation: a. borrowing and inspecting books or records, documents that are the basis of bookkeeping or recording, and other documents related to income earned, business activities, personal service by taxpayers, or taxable objects; b. accessing and/or downloading data, information, and evidence managed electronically; c. entering and inspecting certain places or rooms, movable and/or immovable property suspected or reasonably suspected of being used to store books or records, documents that form the basis for bookkeeping or recording, other documents, money, and/or goods that can provide clues about income earned, business activities, personal service by taxpayers, or taxable objects; d. sealing certain places or rooms as well as movable and/or immovable goods; a pretrial motion to the District Court may be filed.”
The Petitioners also request that the Court declare the clause “Procedures for examination of preliminary evidence of criminal offense” in the amendment to Article 43A paragraph (1) in Article 2 point 13 on the HPP Law unconstitutional and not legally binding if not interpreted as “only relating to technical-administrative matters and not limitation and/or expansion of the rights and obligations of citizens.”
Author : Sri Pujianti
Editor : Nur R.
PR : Andhini S.F.
Translator : Nyi Mas Laras Nur Inten Kemalasari/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.
Tuesday, November 07, 2023 | 16:30 WIB 108