A significant administrative tax dispute regarding the right to interest compensation resurfaced in the Tax Court between PT UMI and the Director General of Taxes. The case centered on the Defendant's refusal of an interest compensation claim totaling IDR 4,754,723,033 filed by the Plaintiff following their partial victory at the Appeal stage for Corporate Income Tax Fiscal Year 2016. The core conflict began when PT UMI settled a Tax Underpayment Assessment (SKPKB) of IDR 17.7 billion before filing an objection; however, when the appeal verdict declared an overpayment of IDR 9.9 billion, the request for interest on those funds was rejected by the tax authorities.
PT UMI based its argument on Article 27A paragraph (1) letter a of the KUP Law and Article 87 of the Tax Court Law, which explicitly mandates a 2% monthly interest compensation (maximum 24 months) if an appeal is partially or fully granted. Conversely, the Directorate General of Taxes (DGT) relied on the technical implementing regulation, specifically Article 83 paragraph (5) of PMK-18/2021, which stipulates that interest compensation is not granted if the overpayment arises from the settlement of an SKPKB, whether agreed upon or not during the Final Closing Conference of the tax audit.
The Panel of Judges, in their consideration, aligned with the DGT's stance. The judges ruled that since the tax overpayment originated from the settlement of the 2016 Corporate Income Tax SKPKB by the Plaintiff on January 10, 2020, the restrictions in PMK-18/2021 were binding. The final verdict rejected the Plaintiff's lawsuit in its entirety, meaning the expected interest compensation could not be realized.
This decision carries serious implications for taxpayer litigation strategies in Indonesia. The rejection underscores that paying off a tax assessment (SKPKB) before the objection or appeal process carries the risk of forfeiting interest compensation rights, even if the taxpayer is later proven correct in court. It serves as a crucial reminder for corporations to meticulously evaluate payment options for disputed taxes under the framework of PMK-18/2021 and the HPP Law.
Key Lesson: Winning the legal battle on the tax substance does not automatically guarantee a win on the financial compensation (interest). Under current regulations, the timing and nature of your initial payment can permanently block your path to claiming interest rewards.
A Comprehensive Analysis and the Tax Court Decision on This Dispute Are Available Here
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