Tax authorities emphasize need to tighten bank account restrictions

The Director General of Taxation (Dirjen) of the Ministry of Finance (Kemenkeu) has expressed his opinion on the new rule prohibiting the opening of new accounts for individuals or entities that are not willing to provide information to identify their financial situation.These rules, as stated in the Minister of Finance Regulation (PMK) No. 47 of 2024, concerning the third amendment to PMK No. 70 of 2017, relate to the technical note on access to financial information for tax purposes. The regulation was issued to maintain the validity of data on financial accounts of individuals or entities managed by the Directorate General of Taxation, as well as the exchange of data with financial services institutions. Therefore PMK 47 contains provisions that banks or financial institutions must perform due diligence. Through this provision, financial services institutions are required to check for practices that circumvent tax obligations before opening new accounts or servicing transactions on old accounts. Therefore if there is an opportunity to prevent the exchange of data and information, the government has the right to assess what the data that should be exchanged should look like.

With these new regulations, he hopes that the quality of data exchanged or received by Indonesia abroad will be better, so this is really a common agreement at the international level. The Minister of Finance not long ago issued PMK No. 47 of 2024 regarding the third amendment to PMK No. 70 of 2017 regarding the technical note on access to financial information for tax purposes. The issuance of the new provisions takes into account the fact that PMK No. 70 of 2017 has not yet regulated the anti-avoidance provisions in accordance with the common reporting standards and therefore needs to be amended.One of the changes provided for in Article 10A of PMK 47 of 2024 is that financial institutions may not open new financial accounts for individuals or entities that do not meet the identification reporting requirements for financial accounts, nor may they provide the owner of the old financial account, who has refused to comply with the requirements, with new transactions related to the financial account.