SWOT Analysis of Indonesian Tax Administration Innovation in the Digitalization Era

Abstract

With the innovation in tax administration services in Indonesia in the digitalization era, it is hoped that it can increase taxpayer compliance and is expected to continuously have a positive effect on state revenues. The purpose of this study is to analyze what are the strengths, weaknesses, opportunities and threats in the implementation of tax administration innovations in Indonesia in the Digitalization Era. The research method used is qualitative with a descriptive approach. The results of the study show that the strengths and opportunities that can be utilized are the reliability of human resources that have been fulfilled, as evidenced by the satisfaction index of DGT service users reaching a scale of 4.1. Technology that can still be developed is also a strength. The high participation of taxpayers in following the innovation policy of tax administration is a very big opportunity with the number of manual SPT users recorded which has decreased by 88.8% in the last five years. Weaknesses and threats encountered are the lack of maintenance on the server where server downs often occur during the deadline for reporting SPT. Taxpayers also admitted that they had not fully received directions on how to operate the new tax administration system. Taxpayers need to adapt to the digitalization that is being carried out. So it is the government's duty to pay extra attention to the understanding of taxpayers in the application of the digital tax administration system.

The Effectiveness of Digitizing Tax Administration to Reduce the Compliance Cost of Taxpayers of Micro, Small, and Medium Enterprises (MSMEs)

“…Regarding the procedure for submitting Annual Tax Returns for individual Taxpayers using the 1770S or 1770SS form by e-filling through the Directorate General of Taxes website, it is regulated in the Director General of Taxes Regulation Number PER-39/PJ/2011 as last amended by the Director General of Taxes Regulation Number PER1/PJ/2014 concerning Procedures for Submission of Annual Tax Returns for Individual Taxpayers Using Forms 1770S or 1770SS by E-filling Through the Directorate General of Taxes Website. Furthermore, the Director General of Taxes issued an e-form in 2017 included in the e-filling service (Rahmi & Gangodawilage, 2022).…”

“…E-form services have almost the same function as e-filling. In this service, taxpayers download the annual tax return in advance and can fill it in offline, then upload it when it's finished via the page previously accessed in the e-filling service (Rahmi & Gangodawilage, 2022). The e-registration service is a service for online taxpayer registration.…”

“…Regarding registration procedures, NPWP and inauguration of Taxable Entrepreneurs and changes to Taxpayer and Taxable Entrepreneurs data with the e-registration system are regulated in Regulation of the Director General of Taxes Number 24/PJ/2009. Amended by Regulation of the Director General of Taxes Number PER-02/PJ/2018 concerning the Second Amendment to Regulation of the Director General of Taxes Number PER20/PJ/2013 concerning Procedures for Registration and Granting of Taxpayer Identification Numbers, Business Reporting and Inauguration of Taxable Entrepreneurs, deletion of identification numbers taxpayers, and revocation of the inauguration of taxable entrepreneurs as well as changes in data and transfers of taxpayers (Rahmi & Gangodawilage, 2022).…”

“…Regarding the procedures for carrying out trials for implementing the electronic tax payment system (billing system) in the state revenue module system, it is regulated in the Director General of Taxes Regulation number PER-47/PJ/2011 as last amended by the Director General of Taxes Regulation No. Regulation of the director general of taxes number PER-05/PJ/2017 concerning electronic tax payments (Rahmi & Gangodawilage, 2022).…”

“…Before e-invoices, tax invoices were generated manually, and there was a high probability that they needed to be uniform in the tax invoice format. The new e-faktur application was launched in 2014, where the procedures for making and reporting tax invoices in electronic form are regulated in the Director General of Taxes Regulation Number PER-16/PJ/2014 as last amended by PER-31/PJ/2017 (Rahmi & Gangodawilage, 2022).…”