Peraturan Mutual Agreement Procedure (MAP) is an important process used in resolving tax disputes between two or more countries. The MAP is a procedure that is designed to help taxpayers resolve disputes that arise from double taxation. This process is typically used when two countries claim the right to tax the same income of a taxpayer.
The MAP process is a diplomatic tool used by countries to resolve tax disputes by mutual agreement. This procedure is implemented through various agreements, such as Double Taxation Avoidance Agreements (DTAA), Tax Information Exchange Agreements (TIEA) and other tax treaties. The purpose of the MAP is to eliminate or reduce double taxation and to ensure that taxpayers are not subject to discriminatory treatment.
When disputes arise, the taxpayer can invoke the MAP procedure by submitting a request to the relevant tax authorities. The request must include a detailed explanation of the issue, the relevant tax years, and the amounts in question. The tax authorities of both countries will then work together to resolve the dispute and reach a mutual agreement.
One of the benefits of the MAP process is that it provides taxpayers with a mechanism to resolve disputes without having to resort to costly and time-consuming legal proceedings. Furthermore, the MAP process can lead to a more equitable outcome as it is based on mutual agreement and cooperation. It is also important to note that the MAP process is confidential, which means that the taxpayer`s information is kept confidential throughout the process.
In Indonesia, the MAP process is governed by Peraturan Direktur Jenderal Pajak (PDJP) No. PER-12/PJ/2017. The regulation provides guidelines on the procedures and requirements for submitting a MAP request, as well as the obligations of the tax authorities in the MAP process.
In conclusion, the Peraturan Mutual Agreement Procedure is a process designed to help taxpayers resolve tax disputes between two or more countries. This diplomatic tool is used to eliminate or reduce double taxation and to ensure that taxpayers are not subject to discriminatory treatment. The MAP process provides taxpayers with a mechanism to resolve disputes without having to resort to costly and time-consuming legal proceedings, and the process is based on mutual agreement and cooperation between the tax authorities of both countries.