The Petitioner's legal counsel, Timbul P. Siahaan, submitting a petition revision for judicial review of Law No. 36 of 2008 on Income Tax (UU PPh) and Law No. 42 of 2009 on Value Added Tax (UU PPN), Monday (3/17/2025) in the panel courtroom. Photo by MKRI/Panji.

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JAKARTA (MKRI) - The hearing for the application revision for Case No.  188/PUU-XXII/2024 on the material review of Law No. 36 of 2008 on Income Tax (UU PPh) and Law No. 42 of 2009 on the Third Amendment to Law No. 8 of 1983 on Value Added Tax on Goods and Services and Sales Tax on Luxury Goods, was held by the Court (MK) on Monday, Maarch 17, 2025. This petition was filed by PT Gemilang Prima Semesta and CV Belilas Permai. The hearing was chaired by Constitutional Justice Arsul Sani.

During the hearing, the Petitioner's legal counsel, Timbul P. Siahaan, submitted a petition revision to the "matter" requested for review, namely the review of Article 4 paragraph (1) of Law No. 7 of 2021 on Harmonization of Tax Regulations (HPP Law). "So that it reads like this, the request for material review of the phrase every additional economic capacity received or obtained by taxpayers in the provisions of Article 4 paragraph (1) in Article 3 of Law No. 7 of 2021 on Harmonization of Tax Regulations (State Gazette of the Republic of Indonesia of 2021 Number 246, Supplement to the State Gazette of the Republic of Indonesia Number 6736) and Article 4 paragraph (1) of Law No. 42 of 2009 on the Third Amendment to Law No. 8 of 1983 on  Value Added Tax on Goods and Services and Sales Tax on Luxury Goods (State Gazette of the Republic of Indonesia of 2009 Number 150, Supplement to the State Gazette of the Republic of Indonesia Number 5069) against the 1945 Constitution of the Republic of Indonesia," said Timbul.

So, what has changed, explained Timbul, is that the phrase from Law 36/2008 on the fourth amendment to Law 7/2021 has been replaced by Law 7/2021 on the Harmonization of Tax Regulations. "Because this is the latest law on taxation," he explained.

Furthermore, his party has also explained the legal standing of the Petitioners as private legal entities. "We have explained it in paragraphs 12 and 13. We have stated that Umar Arief as director has the right to represent PT Gemilang Prima Semesta and Ahmad Saqowi as Director has the right to represent CV Belilas Permai," said Timbul.

Timbul also said that the Petitioners thought that their constitutional rights had been violated by the application of the phrase "every increase in economic capacity received or obtained by a taxpayer" in the provisions of Article 4 paragraph (1) in Article 3 of the HPP Law because it has a broad meaning.

Also read: LPG Distributors to Test Articles on Income and Value-Added Tax

For information, at the Preliminary hearing (3/4/2025) the Petitioner experienced specific and actual constitutional losses due to the legal uncertainty caused by Article 4 paragraph (1) of the Income Tax Law and Article 4 paragraph (1) of the VAT Law. According to him, both those articles contradict Article 23A of the 1945 Constitution which stipulates that taxes and other compulsory levies must be based on laws.

Tax collection by the Directorate General of Taxes is carried out based on a decision that determines the tax object, not only based on laws. This can be seen from the issuance of the Tax Underpayment Assessment Letter (SKPKB) to the Petitioners.

Furthermore, the Petitioners argue that the provisions in Article 4 paragraph (1) of the Income Tax Law and Article 4 paragraph (1) of the VAT Law create legal uncertainty because they do not explicitly state that the tax object must be determined based on the law. As a result, tax is imposed on transportation costs, the amount of which is determined by the decision of the governor, mayor, or regent. Taxation of these transportation costs is considered detrimental to taxpayers, especially for those who transport 3 kg LPG gas from agents to bases.

On that basis, the Petitioners hope that the Court can declare that the phrase "... received or obtained by Taxpayers..." in Article 4 Paragraph (1) of the Income Tax Law is contrary to the 1945 Constitution and does not have binding legal force as long as it is not interpreted as "... received or obtained by Taxpayers directly based on actions based on legislation...".

Read the full version of the petition revision in Indonesian:  Perkara Nomor 188/PUU-XXII/2024

Author      : Utami Argawati.

Editor        : N. Rosi.

PR             : Andhini SF.

Translator  : Donny Yuniarto (YS)

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.

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