Literacy Law - This article discusses Indonesian laws and regulations regarding the obligation of heirs to pay off tax debts still owed by their predecessors. It explains how the law forces heirs to take over the tax responsibilities of deceased predecessors, especially through the self-assessment tax system regulated in Law No. 7 of 2021 concerning Harmonization of Tax Regulations.

This explanation is deepened with reference to Law No. 19 of 2020 concerning Tax Collection with Forced Letters, which states that tax debts including administrative sanctions such as interest and fines can be billed to heirs up to the value of the inherited inheritance.

This article also provides insights into civil law and tax administration provisions related to inheritance and applicable tax obligations, as well as dissecting the role of the Directorate General of Taxes in regulating and collecting taxes in Indonesia.

Introduction

Tax is an engagement, where this engagement contains rights and obligations between the state and its citizens. Article 1233 of the Civil Code states that "Engagements arise because of an agreement or because of the law." Article 23A of the 1945 Constitution regulates provisions regarding taxes and other levies that are coercive for state purposes regulated by law. The Directorate General of Taxes (DJP) is an institution that has the authority to collect underpaid tax amounts which will become tax debts and impose sanctions on Taxpayers who do not fulfill their obligations in terms of tax payment and reporting.

The general provisions for tax payments are regulated in Law (UU) Number 7 of 2021 concerning Harmonization of Tax Regulations. In Indonesia, the tax system applied is the Self Assessment system.

Self Assessment is a tax collection system that gives full trust to Taxpayers to calculate and pay their own taxes owed in accordance with tax laws and regulations.

Every Taxpayer is a Tax Subject. However, a Tax Subject is not necessarily a Taxpayer. In Law No. 7 of 2021 concerning Harmonization of Tax Regulations in Article 2 paragraph 1 it is stated that “Tax Subjects are individuals, undivided inheritances as a single unit replacing those entitled, Bodies and Permanent Establishments.”

Here it can be concluded that an undivided inheritance is a Tax Subject following the status of the predecessor. As for the implementation of fulfilling tax obligations, the inheritance replaces the obligations of the entitled heirs. However, if the inheritance has been divided, the tax obligation is transferred to the heirs.