PRD’s Lawsuit Fails! Examining the Authority of the Head of Tax Office in Issuing Assessments and the Prohibition of "Double Dipping" in Objection and Cancellation Procedures

Lawsuit Against the Rejection of SKPKB Cancellation: PRD vs Balikpapan Timur Tax Office

The Plaintiff, PRD, filed a lawsuit against the rejection of a request to cancel a Value Added Tax (VAT) Underpayment Assessment (SKPKB) for the March 2018 period issued by the Balikpapan Timur Tax Office. This dispute focuses on two crucial issues: the legality of the Head of the Tax Office's authority to issue tax assessments and the procedural limits of filing a request under Article 36 of the KUP Law after a taxpayer has pursued the objection route.

Core Conflict: Legality of Authority and Internal Instructions

The core of the conflict began when the Plaintiff alleged that the SKPKB was legally flawed (void ab initio) because it was issued by the Head of the Tax Office, who, according to the Plaintiff, lacked attribution authority under the KUP Law. The Plaintiff cited Supreme Court Decision Number 4 P/HUM/2024 to argue that the delegation of authority via KEP-206/PJ/2021 was merely an internal instruction not binding on external parties. Conversely, the Defendant (DGT) emphasized that issuing the assessment was a valid exercise of mandate under the Administration of Government Law. The Defendant also rejected the Plaintiff's request because the same matter had been decided in a previous objection process, thus violating the restrictions in PMK Number 8/PMK.03/2013.

Judicial Resolution: Adherence to PMK 8/2013

The Board of Judges, in its resolution, stated that the Defendant's action in returning the Plaintiff's request was legally correct. The Board opined that based on Article 14 paragraph (2) of PMK 8/2013, a Taxpayer cannot file a request for reduction or cancellation of a tax assessment if an objection has been filed and a decision has been issued. Regarding the authority issue, the Board confirmed that the Head of the Tax Office possesses authority based on a mandate from the Director General of Taxes, which is legally recognized as effective for tax administration functions, including the issuance of assessments.

Legal Analysis: The Electa Una Via Doctrine

Analysis of this decision highlights the importance of adhering to the hierarchy of legal procedures (the doctrine of electa una via). The implications of this decision reinforce that once a Taxpayer chooses the objection path (Article 25 of the KUP Law), the administrative cancellation path (Article 36 of the KUP Law) is closed for the same matter. In conclusion, a litigation strategy attempting to cancel an assessment via a lawsuit on the grounds of attribution authority cannot replace or override the formal objection procedures already undertaken.