Korea’s National Tax Service Commissioner Lim Kwang-hyun (left) and Indonesian Tax Commissioner Bimo Wijayanto pose after signing a memorandum of understanding in Jakarta on Tuesday. (National Tax Service)
Korea’s National Tax Service Commissioner Lim Kwang-hyun (left) and Indonesian Tax Commissioner Bimo Wijayanto pose after signing a memorandum of understanding in Jakarta on Tuesday. (National Tax Service)

Korea’s National Tax Service and Indonesia’s Directorate General of Taxes signed a memorandum of understanding in Jakarta on Tuesday to strengthen cross-border tax collection and crack down on intentional evasion.

NTS Commissioner Lim Kwang-hyun and Indonesian Tax Commissioner Bimo Wijayanto formalized the deal during this week's 12th Korea-Indonesia Commissioners’ Meeting. The agreement establishes clearer procedures for enforcing tax claims in each other’s jurisdictions, including the ability to seize assets held overseas, and creates direct communication channels for coordinated investigations.

Indonesia had previously requested Korea’s support in adopting its advanced electronic tax system at a regional tax administrators meeting in Australia in September, citing the expanding presence of Korean companies in the country and the need for stronger administrative cooperation.

“Building on this agreement, we will work closely together to ensure swifter and more efficient tax debt collection in both jurisdictions,” Lim said.

Ahead of the bilateral discussions, the NTS met with Korean firms operating in Indonesia to address ongoing concerns such as delayed VAT refunds and double taxation. Companies showed support for recent progress on mutual agreement procedures, and Lim conveyed their grievances to Indonesian officials, calling for continued efforts to improve the tax environment.

During the visit, Lim also reviewed a case involving a high-value Korean tax-delinquent company whose Indonesian affiliate is in bankruptcy. The NTS has appointed a local law firm and is participating in the liquidation process alongside Indonesian authorities — the first time Korea has joined an overseas bankruptcy to recover unpaid taxes.

The NTS said it will continue expanding tax diplomacy and international cooperation to combat malicious evasion while ensuring more predictable tax administration for Korean businesses abroad.


andreahaneu@heraldcorp.com