TEMPO.CO, Jakarta - The Indonesian government has asked Google Asia Pacific Pte. Ltd, the parent company of Google Indonesia, to immediately pay its taxes. As a company that has a physical entity in Indonesia, Google is a permanent business entity (BUT) that are subjected to paying an income tax.

"We are no longer talking about deals here. What we want to know is how much they are making, and since they are a permanent business, there is no going around it," Jakarta's special tax office head Muhammad Haniv said in Jakarta Tuesday, January 10.

Haniv said the Tax DG has investigated Google's business process in Indonesia before determining that it is a permanent business. "They have hundreds of servers in Jakarta and around Indonesia," Haniv said.

With the existence of physical installation, Google is a permanent business subjected to tax, according to Haniv.

In 2016, the Tax DG and Google failed to agree on the amount of tax the company must pay. Google refused in pay Rp 6 trillion in tax arrears and a penalty of Rp 3 trillion, which were the figures given by the DG based on its calculation. Google claimed their total tax bill was between Rp 337.5 billion and Rp 405 billion.

The Tax DG had agreed to give a discount of Rp 1 trillion to Rp 2 trillion, but Google still refuses the offer.

Haniv said that because both parties have failed to reach an agreement, the the Directorate General will begin its preliminary audit.

The Tax DG had asked Google to immediately provide supporting electronic documents about their finances. Haniv said there is no deadline for the document submission as it was a special investigation and they are still in preliminary stage.

Haniv aded that if Google fails to submit the documents, the DG will investigate the case further and charge the tech giant with a 400-percent penalty.

ANGELINA ANJAR SAWITRI|DESTRIANITA