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DDTC Working Paper 1717

                   through trade mispricing , but possibly restricted   the possibility  to certain extent  this valuable
                   for research purpose.                            information could be obtainable or accessible for
                                                                    research purpose.
                      On the whole, one should note that  the
                   utilization  effectiveness of these data  are reliant   Accordingly, the future path  of  BEPS
                   to the support of non-tax data provision, such as   measurement is clearly dependent  on the
                   economic  data,  financial  or  business  data  and   improvement of quality and relevance of available
                   governance information. These all  are important   data to improve indicators and economic analyses
                   to segregate BEPS-related practices from usual   of BEPS. In the current state of BEPS  analysis,
                   business activities that  are blended in certain   Fiscal Policy Agency (FPA) is still generally utilizing
                   datasets, such as FDI, corporate tax base erosion,   available  data, with some  data that  actually
                   or  reported  profit.  Classifying  those  type  of  data   already collected by other government institution
                   and bridging them to measurement tools would     – particularly DGT – are not incorporated due to
                   provide more accurate estimation and describe the   there is no data integration between the two.
                   nature of BEPS in relation with other factors.
                                                                       Although  there are some  new and innovative
                   5.2.  Future Focus: Optimizing the Potential for   BEPS analysis, they are all significantly constrained
                   Future Research                                  by  significant  data  limitations.  The  academic
                                                                    community has demonstrated its creativity in
                      Given the classification described in Table 2, we   examining  new dimensions  of BEPS  to explore
                   can infer that the major limitation lies on micro-  with currently available  data, but  still,  new data
                   research data. There are very few MNEs data that   availability will bring huge benefit and extend the
                   publicly  open  their  financial  information,  and   length of possible further BEPS analyses.
                   almost  none of  them provide  the data  in detail.
                   Some of their necessary  data  are provided  in     Hence, it means that improved data and tools
                   financial database, such as ORBIS, but only a small   are necessary if the global community is to obtain a
                   number of MNEs.                                  clearer picture of the scale and impact of BEPS and
                                                                    properly monitor the effectiveness of the measures
                      Furthermore, MNEs who are seeking investment
                                                                    implemented  by the government. The  main goal
                   from capital market and openly listed in Indonesia
                                                                    is that in the future, better data would allow new
                   Stock  Exchange  (IDX)  provide  their  necessary
                                                                    and  more  refined  indicators  as  well  as  refined
                   data to IDX and Financial Services Authority (OJK)
                                                                    economic analyses of BEPS and the effectiveness of
                   confidentially  and  only  for  limited  purpose.  In
                                                                    BEPS countermeasures.
                   addition, most of MNEs in Indonesia are not openly
                   listed in Indonesian capital market, hence it is not   Principally, OECD described important features
                   ideal to put effort to open the data.            of ‘better’ data as follows :
                      However, with the enactment of PMK 213, the   1.  More  relevant  BEPS  information  (i.e.  total
                   government should anticipate new  information       MNE tax payments by country, tax  residence
                   provided  by  MNEs  through transfer pricing        of the entity  rather than  simply country of
                   documentation in the form of headquarter and        incorporation, related party transactions and
                   country by country reporting documentation          structures).
                   – aside  from usual  local  documentation.  This   2.  More coverage of companies, countries, and
                   availability  means new  data source is exist  to   MNE relationship, which include:
                   advance BEPS  measurement and  magnitude.  The
                                                                       •  More complete set of companies (e.g. fewer
                   data can help in in improving research development
                                                                          missing  entities and groups and better
                   regarding risk assessment  in identifying  any
                                                                          coverage across all countries).
                   transaction that potentially creates transfer pricing
                   activities or other BEPS schemes.  But we should    •  More complete information from currently
                                                                          available company tax and non-tax records.
                   remind as well  that  the effectiveness  of BEPS
                   measurement have dependency to certain level on     •  Clear identification of MNE companies on tax
                   how effective the government could gain data from      return  forms, both domestic companies of
                   this regulation.  Government should then consider      foreign MNE parents and domestic parents
                                                                          of  foreign  affiliates.  Improved  linkages
                   48. Kimberley A. Clausing, “Tax-Motivated Transfer Pricing and US   between related entities and overall  MNE
                   Intrafirm Trade Prices”, Journal of Public Economics  No. 87(2003).  group information.
                   49. See Minister of Finance Regulation (PMK) 213/03/2016 Chapter 2.  3.  Increase access to available data for government
                   50. See UN, United Nations Practical Manual on Transfer Pricing for
                   Developing  Countries  (New York: UN,  2013), 83-111 as quoted in
                   B.  Bawono  Kristiaji, “Incentives and Disincentives of  Profit Shifting in   Shifting dan Dampaknya terhadap Peraturan Pajak di Indonesia”, DDTC
                   Developing Countries”, Master Thesis for Tilburg University (2015): 89.  Working Paper No. 0714 (2014): 18.
                   51. Darussalam and Ganda C. Tobing, “Rencana Aksi Base Erosion Profit   52. OECD, Opcit, 251.
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