On January 2, 2024, the Supreme Court of Indonesia issued Circular No. 2 of 2024 (SEMA 2/2024), introducing new restrictions on judicial reviews (Peninjauan Kembali) filed by state administrative bodies or officials, including the Directorate General of Taxes (DGT) and the Directorate General of Customs and Excise (DGCE). This development has significant implications for how tax disputes, especially those involving Tax Court decisions, are handled. A key question raised by this circular is whether these restrictions apply to judicial reviews of Tax Court decisions, which are governed by the Tax Court Law.

𝗦𝗘𝗠𝗔 𝟮/𝟮𝟬𝟮𝟰: New Limitations for Filing Judicial Reviews

SEMA 2/2024 imposes new conditions on judicial reviews by state administrative bodies or officials. Judicial reviews are now restricted to cases involving new evidence (novum), conflicting final and binding decisions, or circumstances where civil rights need to be protected, or state or regional assets must be safeguarded. These restrictions are significantly more stringent compared to previous provisions, which allowed greater flexibility for state bodies to challenge judicial decisions.

This circular aligns with Constitutional Court Decision No. 24/PUU-XXII/2024, which further clarifies the specific grounds under which state administrative bodies or officials can file judicial reviews. However, the question arises whether these new restrictions are applicable to judicial reviews of Tax Court decisions, considering that the Tax Court is a specialized court within the State Administrative Court system.

𝗜𝘀 𝘁𝗵𝗲 𝗧𝗮𝘅 𝗖𝗼𝘂𝗿𝘁 𝗟𝗮𝘄 𝗮 𝗟𝗲𝘅 𝗦𝗽𝗲𝗰𝗶𝗮𝗹𝗶𝘀 𝗱𝗲𝗿𝗼𝗴𝗮𝘁𝗶𝗻𝗴 𝗧𝗵𝗲 𝗦𝘁𝗮𝘁𝗲 𝗔𝗱𝗺𝗶𝗻𝗶𝘀𝘁𝗿𝗮𝘁𝗶𝘃𝗲 𝗖𝗼𝘂𝗿𝘁 𝗟𝗮𝘄?

A crucial point to consider in addressing this question is the relationship between the provisions of SEMA 2/2024 and the Tax Court Law, particularly Article 77(3) of Law No. 14 of 2002 on the Tax Court. This article explicitly allows all parties involved in a tax dispute to file for a judicial review of a Tax Court decision, without being constrained by the stricter conditions set out in SEMA 2/2024.

Article 132(1) of Law No. 5 of 1986 on the State Administrative Court, which was modified in response to the Constitutional Court’s decision, restricts state administrative bodies or officials from filing judicial reviews unless specific conditions are met. However, the Tax Court Law, as a specialized law governing tax matters, contains provisions that are more flexible in terms of judicial review. This raises an important issue: should the provisions of Article 77(3) of the Tax Court Law take precedence over the more general provisions of Article 132 of the State Administrative Court Law? This is where the principle of lex specialis derogat legi generali (specific laws override general laws) becomes critical.

In this case, the Tax Court Law is the specific law governing tax-related disputes and judicial reviews of Tax Court decisions. Since the Tax Court deals specifically with tax matters, its provisions are expected to prevail in the event of a conflict with the more general provisions of the State Administrative Court Law. Therefore, it is plausible that the restrictions imposed by SEMA 2/2024 may not apply to judicial reviews of Tax Court decisions.

𝗧𝗵𝗲 𝗣𝗼𝘀𝘀𝗶𝗯𝗶𝗹𝗶𝘁𝘆 𝗼𝗳 𝗗𝗚𝗧 𝗼𝗿 𝗗𝗚𝗖𝗘 𝗔𝗽𝗽𝗹𝘆𝗶𝗻𝗴 𝗳𝗼𝗿 𝗝𝘂𝗱𝗶𝗰𝗶𝗮𝗹 𝗥𝗲𝘃𝗶𝗲𝘄𝘀 𝗮𝗳𝘁𝗲𝗿 𝗦𝗘𝗠𝗔 2/2024

The Tax Court is a specialized judicial body that deals with tax disputes and its decisions are considered final and binding under Article 77(1) of the Tax Court Law. This means that there is no possibility for appeal or cassation, which are typically available in general court systems. Therefore, the only legal recourse left for disputing parties is to file for a judicial review as provided for in Article 77(3) of the Tax Court Law.

Given that Article 77 of the Tax Court Law is more specific to tax matters and provides a broader scope for judicial reviews, it is likely that the DGT and DGCE may still be able to apply for judicial reviews without being bound by the more restrictive conditions set by SEMA 2/2024. Since SEMA 2/2024 was primarily designed to regulate judicial reviews of decisions in the broader state administrative context, the specific nature of tax law might provide the DGT and DGCE with an avenue to continue filing judicial reviews, even if these reviews do not meet the criteria outlined in the circular.

While the Tax Court Law’s provisions on judicial review could potentially take precedence over SEMA 2/2024, this issue will likely need further clarification by the courts or the Supreme Court itself. The DGT and DGCE, as key state bodies involved in tax matters, may continue to face legal uncertainty regarding their ability to file judicial reviews, especially as the tax landscape evolves.

𝗧𝗵𝗲 𝗜𝗺𝗽𝗮𝗰𝘁 𝗼𝗳 𝗦𝗘𝗠𝗔 2/2024 on Tax Disputes

The introduction of these new restrictions in SEMA 2/2024 has the potential to change how judicial reviews are handled in the tax sector. For the DGT and DGCE, judicial reviews are an essential legal remedy, as they are often the only option left for challenging Tax Court decisions. If the restrictions outlined in SEMA 2/2024 do not apply to Tax Court decisions, the DGT and DGCE could continue to file judicial reviews in cases where they believe a Tax Court decision is in conflict with tax laws or regulations. However, if the restrictions are determined to apply, it may limit their ability to challenge decisions, potentially undermining their role in enforcing tax laws effectively.

Given the significance of this issue, it is crucial for stakeholders to monitor how judicial reviews in tax disputes are handled under the new guidelines. For the tax authorities and taxpayers alike, understanding the procedural nuances will be vital in ensuring fair and effective dispute resolution. Additionally, regulatory clarifications or future legal rulings will play an essential role in guiding the actions of both the DGT and DGCE in seeking judicial reviews.

In conclusion, while the provisions of SEMA 2/2024 present new challenges, they also open up an important legal dialogue regarding the relationship between specialized tax laws and broader administrative laws. The ultimate resolution of this matter will have lasting implications for how tax disputes are resolved in Indonesia and the ability of tax authorities to hold final Tax Court decisions accountable.