.
BATAM-Kliksuara.com // The Indonesian Citizens Forum (FRIC) has raised questions over alleged discrepancies in building administration and tax obligations involving a business activity in Batam, Riau Islands, which it says may have been operating under the same circumstances for an extended period.
FRIC argues that, if verified through an official examination, the alleged discrepancies could involve not only building licensing issues but also potential tax obligations, regional levies, spatial-planning compliance and other administrative requirements.
FRIC alleges that the building status may not have been updated for a prolonged period. According to the organization, such circumstances could potentially result in unpaid or underpaid tax obligations amounting to hundreds of millions of rupiah.
However, FRIC acknowledges that the actual amount of any tax liability, if applicable, must be determined through an official audit or examination by the competent tax authorities.
Alleged Addition of Nine Buildings
FRIC is also questioning the alleged addition of nine buildings without corresponding amendments to the Building Approval (PBG) and other required documentation.
According to FRIC, if verified, the alleged circumstances should be examined from several perspectives, including building-use compliance, spatial planning, building approval, Certificate of Proper Function (SLF), regional levies and tax obligations associated with the business activity.
The organization is therefore calling for a comprehensive review of lease agreements, payment records, Land and Building Tax (PBB-P2) obligations and applicable income-tax obligations arising from property leasing and business operations.
Business Legality Cannot Be Assessed Solely Through OSS
FRIC also questions whether the legality of a tourism-related business can be assessed solely on the basis of its Business Identification Number (NIB) or licensing obtained through the Online Single Submission (OSS) system.
According to the organization, the legality of a business must also be examined through the underlying status and allocation of the land, spatial-planning compliance, building function, PBG, SLF and business licensing requirements.
Where there has been a change in the use or function of a building, FRIC is urging the authorities to verify whether the relevant amendments and approvals have been obtained in accordance with applicable regulations.
If an official examination establishes violations, any administrative measures should be determined by the competent authorities based on the nature and severity of the proven violations.
Depending on the applicable legal provisions, such measures could include requirements to rectify administrative deficiencies, administrative sanctions, temporary suspension of certain activities, or revocation of approvals or licenses where legally justified.
FRIC is also questioning why the alleged discrepancies are said to have continued for approximately 15 years without what the organization considers to be adequate enforcement or corrective action.
The questions are directed toward the relevant authorities, including BP Batam and the Batam City Government.
FRIC Calls for Tax and Legal Examination
Based on statements attributed to parties associated with the business activity and information presented by FRIC, the organization, together with members of the community, is calling for a comprehensive examination.
FRIC is urging the Directorate General of Taxes (DJP) of the Ministry of Finance, law-enforcement authorities, the Batam City Government and BP Batam to conduct verification within their respective areas of authority.
FRIC is also calling on the Riau Islands Regional Police (Polda Kepri) and the Riau Islands High Prosecutor's Office (Kejaksaan Tinggi Kepri) to examine whether there is evidence of potential legal violations, including possible tax issues, abuse of authority or other offenses connected to the business activity and use of the buildings.
Meanwhile, the relevant tax authorities and the Batam Regional Revenue Agency (Bapenda Batam) are being urged to examine:
- Land and Building Tax (PBB-P2) obligations;
- the classification and NJOP of the properties;
- lease agreements and related transactions;
- applicable income-tax obligations arising from leasing and business operations;
- Value Added Tax (VAT/PPN) obligations, where applicable under Indonesian tax law; and
- other relevant regional tax or levy obligations.
BP Batam and Batam Government Urged to Conduct Field Inspection
FRIC is also urging BP Batam and the Batam City Government to conduct a joint field inspection.
The inspection, according to FRIC, should cover the entire chain of legality, including land status and allocation, spatial-planning compliance, building approval, PBG, SLF and business licensing.
The results of the examination should then serve as the basis for determining whether any violation has occurred and what administrative measures, if any, may legally be imposed.
FRIC argues that such a process is necessary to ensure that the matter does not remain a dispute based solely on competing claims, but is instead resolved through official documents, field verification and transparent legal procedures.
“The law must not be enforced selectively. Whether the owner or operator is a foreign national or an Indonesian citizen, everyone is required to comply with the spatial-planning regulations and tax laws of the Republic of Indonesia,” Hendri said.
FRIC emphasized that all of the allegations should be tested through examinations conducted by authorities with the appropriate legal mandate. If violations are established, any further action should be based on verified evidence and the applicable laws and regulations.
