Repatriation of funds by Indonesians parking their funds abroad is expected to result in increase in investment in the country after the tax amnesty program .
"We have surveyed in retail business and the effect is not yet significant," President Director of the securities subsidiary of state lender Bank Mandiri Silvano Rumantir said here on Sunday.
Mandiri Sekuritas is one of 19 securities traders named by the government as gateways for repatriated funds under the tax amnesty program.
"Since the day the tax amnesty program was launched by the government the daily transactions handled by Mandiri Sekuritas has not changed significantly from the average level of Rp500 billion per day. That indicated there has not been significant effect of the program on investment in bonds and shares," Silvano said.
The government, however, has described the program as successful.
Finance Minister Sri Mulyani said Indonesia was the most successful among countries in the world ever adopting the tax amnesty policy.
According to the Taxation Directorate General, by Oct. 2 at 10.30 local time tax payers already submitted 372,428 declaration of assets paying redemption at Rp89.2 trillion to the government.
Tax payers already declared and repatriated assets valued at Rp3,621 trillion assets until the first three months of the tax amnesty program.
The assets included Rp2,533 trillion in domestic assets, Rp951 trillion assets abroad and Rp137 trillion already repatriated.
Silvano said clients of banks and investment managers could use repatriated funds to buy bonds and shares.
Mandiri Sekuritas has 54,000 clients investing in stock market with transactions reaching Rp80.8 trillion or a market share of 3.9 percent by August 2016.
The tax amnesty program is divided into three periods - First from July to September 30 , second from October 1 to December, 2016 and from January 1 to March 31 of 2017 with redemption tariff rising from 2 percent in the first period, to 3 percent in the second period and 5 percent in the last period. (WDY)