Usman, Rien Handarwati July and Buang, Abd. Aziz (2008) Risk analysis of tax consolidation application in frontier areas on government income. Jurnal Kemanusiaan (11). pp. 80-100. ISSN 1675-1930
Official URL: http://www.fppsm.utm.my/download/cat_view/13-jurna...
A country needs stronger incentives to increase exploration investment in high-risk isolated frontier and deepwater areas. Tax consolidation is one of the possible incentives to raise exploration investment level in those frontier areas. Tax consolidation means that expenditures of non-producing contract(s) can be deducted from the income of producing contracts of the same contractor(s) for determination of taxable income. From the government point of view, the application of tax consolidation represents its current investment for future income. In this study, risk analysis of the application of tax consolidation in frontier areas was taken with Monte Carlo simulation to identify its impact on the Government of Indonesia (GOI) income and on the profitability of contractor as well as quantifying the risk involves respectively. The result showed, that from contractorâ€™s financial aspect, tax consolidation was more attractive incentive compared to increase in production sharing split. On the other hand, it was less attractive to the GOI, not only because it reduced GOIâ€™s NPV, but it also posed high risk to the GOI.
|Uncontrolled Keywords:||tax consolidation, risk analysis, monte carlo simulation, production sharing contract|
|Subjects:||H Social Sciences > HC Economic History and Conditions|
H Social Sciences > HJ Public Finance
|Divisions:||Management and Human Resource Development (Formerly known)|
|Deposited By:||Norshiela Buyamin|
|Deposited On:||05 May 2009 08:52|
|Last Modified:||27 Sep 2010 02:14|
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