Account Representative’s Challenges in Supervising Affiliated Transactions on Intragroup Loans

Abstract

Amendments to the supervisory business process by the Directorate General of
Taxes in SE-05/PJ/2022 require the Account Representative to conduct
transfer pricing analysis. The analysis at the supervision stage is expected to
improve cooperative compliance and reduce transfer pricing disputes. This
study will examine the problems in monitoring affiliate transactions on
intragroup loans by Account Representatives as a result of business process
changes. This study makes a empirical contribution by addressing research gap
in affiliate transactions on intragroup loans from the standpoint of tax
supervisions. This study is a case study on Account Representatives at the
Directorate General of Taxes, conducted using qualitative descriptive
methodologies. Open-ended surveys and interviews are utilized for
triangulation purposes to increase the level of validity. The findings revealed
that barriers to the supervision of affiliate transactions on intragroup loans
include inadequate personnel capability, lack of taxpayer cooperation,
regulatory issues and organizational issues.