Tax Court Administration to be Under Supreme Court
On May 20, 2023, the Constitutional Court of the Republic of Indonesia (the “Constitutional Court”) issued the decision No. 26/PUU-XXI/2023 (the “Decision”) in relation to a substantive review petition (the “Petition”) of Article 5 paragraph (2) of Law No. 14 of 2002 dated April 12, 2002 on Tax Court (“Law 14/2002”). We highlight below the key points of the Decision:
♦ The Petition
In the Petition the petitioners had requested that the Constitutional Court declare Article 5(2) of Law 14/2002 to be unconstitutional. Alternatively, the petitioners had requested that the Constitutional Court declare Law 14/2022 entirely to be unconstitutional.
Such requests in the Petition are based on the following facts pertaining to the Tax Court:
- Article 5(2) of Law 14/2002 states that the development of the organization, administration, and finances of the Tax Court are conducted by the Ministry of Finance (the “MOF”). According to the petitioner, such provision creates dualism in the control over the Tax Court since according to Article 5(1) of Law 14/2002, the Supreme Court is the institution that is authorized to conduct the technical development of judiciary of the Tax Court;
- The Tax Court should be considered a part of the judiciary power, instead of the executive power. Therefore, the Tax Court should be entirely controlled by the Supreme Court as per Article 24(2) of the Indonesian Constitution;
- The Tax Court had already been declared as a part of the Administrative Court (therefore, a part of the Supreme Court) under the consideration of the Constitutional Court Decision No. 6/PUU-XIV/2016 dated August 4, 2016; and
- There is already a bill for the amendment of Law 14/2002 which contains the provision that the development of the organization, administration, and finances of the Tax Court will be handed over to the Supreme Court.
♦ The Decision
The Constitutional Court agrees with the Petition and declares that the development of the organization, administration, and finances of the Tax Court shall be handed over to the Supreme Court in stages until not later than December 31, 2026.
June 7, 2023
AKSET
Please contact Johannes C. Sahetapy-Engel (jsahetapyengel@aksetlaw.com), Thomas Peter Wijaya (twijaya@aksetlaw.com), or Alfan Zakiyanto (azakiyanto@aksetlaw.com) for further information.
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