Realizing The Target Revenue Of Land And Building Tax In Jambi City

Limited Human Resources in Local Tax and Retribution Management Agency LTRMA

Local Tax and Retribution Management Agency (LTRMA) of human resources for land and building tax management until 2016 is amount to 34 (thirty four) people, consisting of 13 (thirteen) civil state apparatus and the rest of them are contract employees. The qualifications of education are: One person has graduated from master degree. Fifteen people have got bachelor of art. Eight people have got diploma three. Two people graduated from diploma one. Eight people graduated from senior high school. The number of employees who have the educational qualifications required for the implementation of technical functions such as for data collection and assessment of tax objects and for data and information processing function are also still limited. For data collection and valuation function, human resources that have qualified education as Appraiser of Tax Object are only 3 (three) persons, while for data and information processing function, the number of employees who have qualified education as operator of data recording only 2 ( two ) persons. In carrying out their duties they were assisted by other employees as well as from contract employees who were recruited by Local Tax and Retribution Management Agency (LTRMA). The number of employees is very irrelevant to the total area of Jambi City which consist of 8 districts and 62 sub districts (Since 2017, the number of district in Jambi City becomes 11 districts). Moreover, they do not only carry out the functions in land and building tax management, but also for the tax on Duty on Land and Building Right Acquisition Management (DLBRA).

The limited number of human resources needed to carry out the data collection function causes ineffectiveness of the data collection function which cannot run properly. Referring to Mayor Regulation Number 12 Year 2014 is concerning the Procedure of Data Collection and Registration of Urban Land and Building Tax Objects, after registration of tax object by the tax payer by filling Tax Object Notification Letter (TONL). The data collection is done by the officer of data collection and assessment to match and adjust the tax object and subject data that exist with conditions on the field. However, the data collection conducted by Local Tax and Retribution Management Agency (LTRMA) on the registration of tax object is not always done by directly enter the field. According to Faisal Iskandar, the officer of Data Collection and Appraiser, for field data collection is mostly directed to potential tax object, whereas the tax object that is not potential, if the data submitted by the tax payer in Tax Object Notification Letter (TONL) and Tax Object Notification Letter Attachment (TONLA) accompanied by the letter from the head of sub district is considered valid, then the officers is no longer needed to go to the field (Iskandar, 2017).

In this case according to the researcher it is not necessarily that all the tax object data set forth in the Tax Object Notification Letter (TONL) and Tax Object Notification Letter Attachment (TONLA) filled honestly and correctly by the tax payers. This can certainly affect the amount of tax revenue, especially when the number of objects that are not potential is quite a lot. Not doing this data collection can also cause a striking difference in the amount of tax debt that has been set for the taxpayer who fills the Tax Object Notification Letter (TONL) correctly by the incorrect one, especially if the location of the objects is close enough, such as the house location. This is contrary to the principle of similarity in tax collection, as well as causing the public to be reluctant to pay the tax on the land and buildings. W.J. Langen cites by Aristanti Widianingsih, the principle of similarity requires in the same condition between taxpayer with each other’s should be taxed in the same amount (Treated equally) (Widianingsih, 2017) The data collection activities conducted through the sub district, certainly not all of it was done considering the limited number of personnel in each sub district.

Moreover, human resources for the implementation of billing functions are also limited. This limitation leads to the ineffectiveness of the collection function of the tax arrears. To withdraw tax arrears, the Jambi City Government made a policy by issuing Mayor Regulation Number 23 Year 2014 concerning Principal Reduction Redemption of Tax Stipulation and Elimination of Administrative Sanction of Urban Land and Building Tax Receivables from 2009 to 2013. Then Mayor Regulation Number 25 Year 2015 concerning Principal Reduction Redemption of Tax Stipulation and Elimination of Administrative Sanction of Urban Land and Building Tax Receivables from 2009 to 2015.

Limited Facilities

Facilities factors also become obstacles in the effort to realize the revenue of land and building tax. First, the limited transportation required by the data collection officer to get to the field, according to Faisal Iskandar, staff of the Data and Assessment Division, the operational vehicles to go to the field are only two units of two-wheeled vehicles, thus becoming an obstacle to go to the field when the weather is not good. Operational funds to go to the field are only budgeted for five working days a month (Iskandar, 2017). Based on this case certainly the number of operational vehicles is not comparable with the number of field officers and the vast area of Jambi City, and the number is classified as minimal. This limitation certainly affects the implementation of the task that being carried out.

Second, the limited facility to place the tax payment. From 2014 to August 2016, cooperation for new payment place is made with Bank Jambi. Bank Jambi has four branches wich are located in the following places. First, One unit office is located in Kecamatan Danau Teluk (Danau Teluk District). Second, one unit is located in Kecamatan Jambi Selatan (The South district of Jambi City). Third, one unit is located in Kecamatan Jelutung (Jelutung District). Fouth, one unit office is located in Jambi Kecamatan Jambi Timur (Eastern District of Jambi City). The number of payment counter facilities which provided is relatively small and relatively far from the widespread of public settlements. In addition to the minimal amount, the payment counter in the District office is also often complained by the public because the officers are rarely in place, as well as the disruption of network connections that make the payment cannot be made at the payment counter.

Cooperation of receipt of payments with other banks such as. Bank BTN (State Saving Bank), Bank Bukopin (Commercial Bank Cooperative Indonesia), OCBC Bank and PT Pos Indonesia (Pos Limited Company Indonesia) are only implemented starting September 2016 or one month before the expiration of land and building tax payment in 2016. Therefore this effort has not much give any effect on the realization of land and building tax revenues until 2016. Therefore, further research is required to see the effect on the realization of tax revenue in year 2017

Third, the limited budget, which is limited funds for the implementation of study task for employees to improve the quality of human resources, resulting in lack of interest and motivation of employees to follow the study task. Limited budget for the data rearrangement activities thus make the data collection activities cannot be done in all of sub districts. In addition to that, there is no budget available to conduct training activities for employees and lack of budget to carry out socialization to the public.

Lack of Public Awareness

The low of realization of revenue compared to the target that has been set indicates the lack of public awareness to pay the land and building tax on time. Generally, land and building tax payments are made when there is a need to deal with government services, such as taking care of residence documents or taking care of licensing. This lack of awareness is not only in the low economic society, but also in the society that has a tax object that is classified as potential. For example, it can be seen based on the data of tax arrears in year 2016. Based on data obtained from the Data and Information Processing section, there are 829 (eight hundred and twenty-nine) of potential tax payers with arrears amounting to 3,842,028,854.00. (Three billion eight hundred and forty two million twenty eight thousand eight hundred and fifty four rupiah, -).

In addition to the lack of awareness of paying the land and building tax, it is also the lack of public awareness to register the tax object that they owned. This according to researcher is caused by the procedure in the registration service in the management of tax payments of land and building. These are classified as complicated. Based on observations that researcher does on the registration of land and building tax on Local Tax Retribution Management Agency (LTRMA) of Jambi City. The registration of land and building tax is done by the taxpayer by filling out the application form and Tax Object Notification Letter (TONL) with the Tax Object Notification Letter Attachment (TONLA) has been provided clearly, true and complete. In the registration, the taxpayer must attach supporting documents in the form of (a) Copy of Certificate, (b) Copy of Identity Card (ID card). (c). A reference from the head of sub district (d) Photocopy of tax receipt of neighbouring land and buildings. After all the requirements are complete, taxpayers are waiting for Notification of Tax Due to be issued as a basis for taxpayers to be able to pay tax on land and building in more than 3 weeks, especially when the number who registered are quite a lot.

The administrative procedures is in the registration service of land and building tax require a long time for taxpayers. Requirements that must be fulfil also require a long bureaucracy, start from requesting reference from the head of sub district. Meanwhile, to request the head of sub district reference, the public must first request a certificate from the local neighbourhood association head. And there is the existence of additional requirements which is must attach the proof of payment of land and building tax owned by neighbours, which of course difficult for taxpayers. This certainly affects the emergence of a lazy attitude for the public to register their tax object to pay tax. Moreover, Aristanti Widianingsih says that the tax collection system should be simple (Widyaningsih, 2017).

The Low Assessment of the Selling Value of Tax Object as the Basic for Imposition of Land and Building Tax

The base of land and building tax is the value of tax object. Based on Local Regulation Number 4 Year 2013, the value of tax object is the average price obtained from a fair sale transaction. The amount of sale value of taxable object is determined by Mayor Regulation every 3 years, except for certain object that can be determined every year according to regional development.

When viewed from the Mayor Regulation Number 16 Year 2014 concerning the Classification and Stimulation of the Selling Value of Tax Objects as the Basis of Taxes on Land and Buildings, it looks not synchronized with the provisions contained in the local regulation, because the amount of value of tax object stipulated in the Mayor Regulation is very low and not in accordance with the current fair price. According to Ahmad Fikri Aiman, staff of Data and Information Processing Division, the amount of the Selling Value of Tax Object Determination in Mayor Regulation Number 16 Year 2014 is still using the standard selling value in 1994 (Aiman, 2007).

This is certainly no longer appropriate the current market value development, especially in Jambi City as a region that is the centre of economy and government. On the other hand, the Local Government has set high land and building tax targets, but is not in proportion to the increase in the number of new land and building tax objects (the amount of Notification of Tax Due (NTD) as seen in the 2015 and 2016 targets. When the City Government dares to set high revenue targets, then it must be followed by the Government's courage to establish the new Value of Tax Object by renewing the Mayor's Regulation Number 16 Year 2014. It is just that this matter needs a deep study, because high tax will make it difficult for the public as well.

Weak Implementation of Tax Sanctions for Taxpayers and the Tax Collection has not been Properly Implemented

Based on Regional Regulation Number 4 Year 2013, sanctions for taxpayers who do not carry out the obligation to pay taxes accordingly is an administrative sanctions in the form of fine. In Article 14 paragraph 2 of Regional Regulation Number 4 Year 2013 is stated that " Notification of Tax Due (NTD) which is not or less paid after the due date of payment shall be imposed with administrative sanctions in the form of a fine of 2% (two percent) per month and billed by the Regional Tax Collection Letter (RTCL)". In practice, the application of this fine sanctions is only done by Local tax and Retribution Management Agency (through a designated Bank or Post Office). Moreover, the Taxpayer pays the land tax and building of the current year. This means that when the taxpayer who will pay the tax on the land and building of the current year know that it has tax arrears of the previous year. The taxpayer is required to pay off the tax arrears along with the fine sanction as determined before making the current tax payment. This means that if the Taxpayer does not make the current tax payment, then the imposition of fine sanctions and withdrawal of tax arrears are not implemented. Thus, it can be said that the application of sanctions against taxpayers who do not carry out tax obligations can be said to be weak .J.B.J.M. Ten Benge as cited by Aminuddin Ilmar claims that the governmental sanction are at the core of government law enforcement. The sanction is needed to ensure the enforcement of governmental law (Ilmar, 2014). Although Article 17 Paragraph 1 and 2 of Regional Regulation Number. 4 Year 2013 has been regulated on tax collection by a forced letter against taxpayers who did not pay the tax bills that have been submitted. But the tax collection with forced survey has not been implemented by Local Tax and Retribution Management Agency (LTRMA). The tax collection by this forced letter is a series of billing actions accompanied by concrete action against the taxpayer for the taxpayer to pay off his tax debt. Roristua Pandiangan says that the government’s action in this tax collection consists of: (1). Executing instantaneous and simultaneous billing (2). Notifying the force letter. (3). Proposing Prevention. (4).Carrying out the foreclosure. (5). Carrying hostages. (6).Selling the confiscated goods (Pandiangan, 2015).

Lastly, it can be seen that problems that hampered the efforts of Local Tax and Retribution Management Agency (LTRMA) in realizing the target of tax revenue of the land and buildings in Jambi City are on the implementation of the regulations of the land and building tax.