Indonesia steps up pressure on Google in tax dispute

  • TECH
  • Tuesday, 17 Jan 2017

A sticker reading 'Review us on Google' is pictured at a smartphone shop in Ambassador Mall in Jakarta, Indonesia, September 19, 2016. REUTERS/Beawiharta

JAKARTA: Indonesia has threatened to prosecute US technology giant Google after the two sides failed to reach a settlement over unpaid taxes, reports said. 

Indonesia is pursuing what officials say is US$73bil (RM325.98bil) in taxes owed by Google for advertising revenue from as far back as 2011, when the search giant first established its Indonesian operations. 

In December the tax office said it had rejected a settlement offer by Google, saying the amount was too small. 

"If there are indications that they are using delaying tactics, it's possible that we will have to take it to the next level of investigation," Muhammad Haniv, the head of the tax office's special-cases unit, was quoted as saying by news website. 

"This will mean that police and prosecutors will be involved," he said. 

Google has said it has paid has paid all applicable taxes and is cooperating fully with the Indonesian government. 

Indonesia has vowed to examine the tax records of global Internet giants such as Google, Facebook and Twitter as it seeks to plug revenue shortfalls. 

The Ministry of Communications and Information said Google and Facebook were responsible for 80% of Indonesia's total digital advertising revenue, worth about US$800mil (RM3.57bil) in 2015, but that their incomes are not properly taxed. 

Indonesia is one of the biggest markets for Facebook and Twitter. — dpa

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