Indonesia Tycoons Line Up for Tax Amnesty in Boost for Plan

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  • James Riady, Tahir say they will participate in tax program
  • Government has earned 4 trillion rupiah so far in amnesty

Two of Indonesia’s wealthiest men said they will participate in a government-led tax amnesty to clear their past omissions, boosting the credibility of the program.

James Riady, the son of Lippo Group’s founder, arrived at the Jakarta tax office on Friday to take part in the plan, according to his spokesman Danang Kemayan Jati. Tahir, the founder of PT Bank Mayapada International who goes by one name, said by phone his family will submit documents this month to support the program.

“If a big fish like Riady joins the program in a public way, that lessens the restraint for everybody else to follow suit,” said Wellian Wiranto, an economist at Oversea-Chinese Banking Corp. in Singapore. “We have seen the momentum start to build, so things are starting to look up for the tax amnesty.”

President Joko Widodo has staked his credibility on a program that the government estimates will bring in 165 trillion rupiah ($12.5 billion) in revenue. He ordered his cabinet to summon the biggest taxpayers, especially those with assets held overseas, to ensure they participate. Since the amnesty began in July, the finance ministry has earned 4 trillion rupiah in penalty fees, or 2.4 percent of the target.

“This program will be very successful because I haven’t met a single person who isn’t planning to participate,” Riady told reporters in Jakarta. “I’m convinced there won’t be another chance and the world is entering a more transparent era.”

Lippo Group is a conglomerate founded by Mochtar Riady in the 1950s with stakes in property developer PT Lippo Karawaci, healthcare company PT Siloam International Hospitals and retailer PT Matahari Department Store. It also has stakes in Singapore-based First Real Estate Investment Trust and Lippo Malls Indonesia Retail Trust.