Wilmar International, the world’s largest listed plantation company, said yesterday it was looking into media reports that it had colluded with tax officials to obtain fraudulent tax refunds.
Two Indonesian newspapers, quoting Indonesian lawmaker Bambang Soesatyo from the Golkar Party, said Singapore’s Wilmar had received or was due to receive total “questionable” tax refunds worth 3.6 trillion rupiah (US$385mil) over the three years from 2007 to 2009.
”We are aware of the report, and we are looking into the matter,” a spokesman for Wilmar said, without elaborating.
The Jakarta Globe and the Jakarta Post reported Soesatyo as saying that the initial allegations were contained in an internal tax directorate report that said Wilmar manipulated its financial statements and then cooperated with someone in the tax department to approve the rebates.
The Indonesian tax office was not immediately available for comment outside normal business hours.
UBS analyst Andreas Bokkenheuser said in a research note that if the reports were substantiated the amounts would have a material impact on Wilmar’s earnings.
”The total restitutions of US$385mil for 2007-2009 accounts for 21% of our full-year net profit estimate. Under Indonesian tax law, the Tax Directorate can impose a penalty of up to four times the outstanding amount,” he said.
Wilmar, which has oil palm plantation assets in Indonesia and Malaysia and plans to start a sugar plantation business on Indonesia’s Papua island, is owned by Malaysia’s Kuok Group.
The allegation came as the country’s tax authority vowed it would continue a tax investigation into Indonesian coal miner PT Bumi Resources, in what is seen as a litmus test of the government’s commitment to reform.
Bumi Resources is owned by the family of Golkar party chairman Aburizal Bakrie.
So,what price integrity and high ideals?
It's over to you, captains of industry as the ball is in your court!
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