2.

3 Controversy of PTUN

Historically, both when he was named Raad van beroep in Belastingzaken until
changed its name to Majelis Pertimbangan Pajak in the 1950s, the level of dispute
resolution (the decision) MPP shall be final and binding on both parties, both DJP and the
taxpayer.
However, after the enactment of Law (UU) No. 5 of 1986 about Peradilan Tata
Usaha Negara (PTUN) dated December 29, 1986, The new controversy arose concerning
the status of MPP. Decision MPP is final and binding the WP and DJP, given the
opportunity to be sued again by WP through the PTUN.
The provisions on the matter actually only contained in explanation of Article 48
of Law No. 5 of 1986,which classified the decision MPP as an example of administrative
decisions that can be compared to the administrative court.
However, the inclusion of MPP decision as one example of a decision
administration contains far reaching consequences. Since then, the court in the PTUN
said that the MPP is part of Badan Tata Usaha Negara, so that they are authorized to
inspect the MPP decision of the lawsuit.
As has been stated by the DGT official, Drs Abroni Nasution (Director of Tax
Regulation at the time), in a seminar which held Center for Fiscal and Monetary Studies
in 1993, explanation of Article 48 of Law No. 5 of 1986, which added the complexity of
tax problem in Indonesia.
Explanation of the article has created a dualism, even more appropriately called
pluralism institutions to handle tax matters in Indonesia. Pluralism arose because,
taxation disputes in Indonesia is handled by a variety of different agencies. Institutions
that deal with tax disputes consisting of one institution administration of justice is not
pure, and two purely administrative agency namely MPP and PTUN.
Tax disputes under the authority MPP include a petition appeals on the tax
assessment letter, Surat Keputusan Kelebihan Bayar and Surat Pemberitahuan Pajak
Terhutang.
 Then, the authority of the PTUN according to Law No. 5 Year 1986 that all the
tax disputes which can not be appealed to MPP and all MPP appeal decision that
unsatisfactory the taxpayer.
Since the MPP's decision grouped as an administrative decision, that turned out
the status of MPP itself as a judicial institution that have authority to handle appeals
taxation. DJP and MPP decisons becomes equally can be appealed again to the PTUN

The negative effects are :

1. It has been used by the parties of taxpayer for reject taxation liabilities. Some
taxpayer petition of tax objection that rejected by MPP, and then can appealed
to the PTUN with MPP as the First Defendant and DJP as second Defendant.

2. Surat paksa can’t be functioning effectively, because the PTUN may issue a
statement to delaying the implementation of Surat Paksa. As pointed out by
the DJP, the malfunction of the MPP and Surat Paksa, makes numbers of
tunggakan pajak increasing. This matter also give an impact on state revenues.

3. In addition, there is also more fundamental result, this make the creation of
unfair treatment between the parties that have a tax problem. This matter
occurred, since taxpayer may file a lawsuit to the PTUN if they are dissatisfied
against the decision of MPP. However, on the other hand the DJP can not do
the same thing when MPP decision not beneficial to the DJP. MPP as a part of
Badan Tata Usaha Negara also give the psychological impact, because then
MPP tend to choose "the safe way " which is with more give the win decision
to tax payer against DJP ".
It had also complained of by the Director General of Taxation, Dr Fuad
Bawazier, by giving the example that during year 1992 and 1993 almost 90
percent MPP decision is gave a victory for taxpayer.
Judicial bodies Taxes
Uncertainty in peradilan pajak , has encourage the opinion about the need to
establish an special court in taxation. It is believed that the establishment of the agency
would provide certainty to taxpayer in their efforts to obtain justice, and on the other side
can better secure state revenues from taxes. Moreover, the current state revenue from the
tax is a "primadonna" to drive the wheels of development, considering foreign loans in the
future is expected to be difficult to increase.