Improving tax environment helps Indonesia move up latest World Bank rankings

Top Quote The new World Bank Doing Business Report shows Indonesia up 11 places in terms of overall ease of doing business, and up 12 places in terms of the country's tax environment. End Quote
  • (1888PressRelease) November 26, 2015 - A recent report from the World Bank suggests Indonesia's business environment has shown considerable improvement over the past 12 months.

    Published annually, the World Bank Doing Business project provides objective measures of business regulations for local firms in 189 economies worldwide. The new report, Doing Business 2016: Measuring Regulatory Quality and Efficiency, shows Indonesia ranked in 109th place in terms of overall ease of doing business, up 11 places on last year's ranking of 120th. The report's assessment of the country's tax environment has also improved, with the country moving up 12 places from 160th to 148th.

    Member firms of the Russell Bedford International accounting network, including KAP Syarief Basir dan Rekan, contributed data to the report's Paying Taxes survey.

    The reason for the country's improved performance on tax can be traced, in part, to the lower number of returns that businesses are now required to make. Whereas companies were previously required to make 65 separate tax payments per year, they are now only required to make 54. While still seriously in excess of the regulatory burden in OECD high-income countries (where businesses spend only 176.6 hours per year on their tax compliance), companies in Indonesia have at least seen a significant reduction here over the past 12 months, now spending 234 hours per year on their tax returns, in contrast to 253.5 last year.

    Syarief Basir, managing partner, commented: "Naturally it is gratifying to see an easier environment for Indonesia's entrepreneurs. But businesses here are still spending 76 hours per year more on tax compliance than their peers in OECD countries. Indonesia will not be genuinely competitive in international markets until further reform is undertaken to correct this."

    About KAP Syarief Basir dan Rekan
    Established in 1994, Kantor Akuntan Publik Syarief Basir dan Rekan (KAP SBR) has since grown to become a full-service professional services firm, specialising in audit and assurance, domestic and international tax planning, and related services, for clients including private and state-owned enterprises operating in the manufacturing, mining, banking, construction, education, and trading industries, as well as hospitals, pension funds, NGOs, and international donor institutions.

    Syarief Basir
    KAP Syarief Basir dan Rekan
    Tel.: +62 21 782 0681 / 0682 / 0683
    E: sbasir ( @ ) russellbedford dot co dot id

    About Russell Bedford International
    Established in 1983, Russell Bedford International is a global network of independent firms of accountants, auditors, tax advisers and business consultants. Ranked amongst the world's leading accounting and audit networks, Russell Bedford is represented by some 600 partners, 5000 staff and 290 offices in more than 100 countries in Europe, the Americas, the Middle East, Africa and Asia-Pacific. Russell Bedford International is a member of the IFAC Forum of Firms and a member of EGIAN, the European Group of International Accounting Networks and Associations.

    Kempton Bedell-Harper,
    Russell Bedford International
    T: +44 20 7410 0339
    E: kempton.bedell-harper ( @ ) russellbedford dot com

    About the World Bank Doing Business project
    The Doing Business project provides objective measures of business regulations and their enforcement across 189 economies and selected cities at the subnational and regional level.

    The Doing Business project, launched in 2002, looks at domestic small and medium-size companies and measures the regulations applying to them through their life cycle.

    By gathering and analysing comprehensive quantitative data to compare business regulation environments across economies and over time, Doing Business encourages economies to compete towards more efficient regulation; offers measurable benchmarks for reform; and serves as a resource for academics, journalists, private sector researchers and others interested in the business climate of each economy.

    In addition, Doing Business offers detailed subnational reports, which exhaustively cover business regulation and reform in different cities and regions within a nation. These reports provide data on the ease of doing business, rank each location, and recommend reforms to improve performance in each of the indicator areas. Selected cities can compare their business regulations with other cities in the economy or region and with the 189 economies that Doing Business has ranked.

    The first Doing Business report, published in 2003, covered 5 indicator sets and 133 economies. The new report covers 11 indicator sets and 189 economies. Most indicator sets refer to a case scenario in the largest business city of each economy, except for 11 economies that have a population of more than 100 million as of 2013 (Bangladesh, Brazil, China, India, Indonesia, Japan, Mexico, Nigeria, Pakistan, the Russian Federation and the United States) where Doing Business, also collected data for the second largest business city. The data for these 11 economies are a population-weighted average for the two largest business cities. The project has benefited from feedback from governments, academics, practitioners and reviewers. The initial goal remains: to provide an objective basis for understanding and improving the regulatory environment for business around the world.

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