REPUBLIKA.CO.ID, JAKARTA -- The government is readying financial market instruments to anticipate funds repatriated by tax payers abroad by offering tax amnesty, according to Finance Minister Bambang Brodjonegoro.
"We are keen to bring the money back. If there are names of Indonesian tax payers in the 'Panama Papers,' we appeal to them to repatriate their funds. We will prepare SUN, SUN BUMN, or corporate bonds, and a year-term time deposit," Bambang stated here on Friday.
The finance minister remarked that preparations were important with regard to deepening the financial market to offer options to tax payers keen on repatriating their funds to Indonesia to be part in the development funding process.
"We certainly hope for the best and make assurance that our system can accommodate the repatriation of funds as banks are expected to absorb the liquidity and channel it towards productive activities," he noted.
Bambang pointed out that the deepening of the market was also necessary as third-party funds and bank deposits as well as the transaction value in the Indonesian capital market were still small as compared to those in Singapore, Malaysia, and the Philippines.
"We understand the importance of maintaining liquidity and efficiency in the financial market for development to realize high economic growth in a sustainable and inclusive manner in order to reduce dependence on banks for funding," he explained.
Muliaman Hadad, chairman of the Financial Service Authority (OJK), noted that the deepening of the financial market was necessary to meet the development funding needs and to boost the nation's economy.
In view of this, the role of providing funding was not only expected to be played by banks but also by derivatives and repo, among others.
"What is also important is that a country will advance if its financial industry also grows as is apparent from the depth of its financial market and the emergence of alternative funding sources from the mobilization of funds outside banks," he remarked.
The finance ministry, Bank Indonesia, and OJK have signed a memorandum of understanding (MoU) on coordination in the framework of developing and deepening the financial market.
The MoU covers the establishment of Development Funding through Financial Market Coordination Forum (FK-PPK), planning, cooperation, and acceleration of the implementation of policies linked to financial market elements, and information and data exchange.
The FK-PPK is expected to build synergy in formulating a comprehensive national strategy for ensuring the growth and deepening of the financial market, which would support national development funding.
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