Sunset Policy in Local Tax (Vehicle Tax) Reviewed from Equity Principles and Its Impact on Tax Payers Compliance

Jakarta Provincial Government has implemented Sunset Policy Program for local tax in 2015 until 2019. This policy goals is to optimize local tax revenue in Jakarta Province. On the other hand, the implementation of this policy made contradictive effects or impact for the taxpayer’s compliance. The method of the study is qualitative with depth interview among key informants in Jakarta Province. The result of this studies is: Sunset Policy Program can lead to inequality between taxpayers who have paid honestly and on time with non-complied taxpayers. This policy can influence taxpayers to refuse to comply because in equity principle tax burdens among tax subjects should be balanced with their abilities to pay and the government is not allowed to discriminate among fellow taxpayers. In the same situations the taxpayer must be treated similarly while in different circumstances the taxpayer must be treated differently. This research illustrated that sunset policy generates inequality in tax collection and lead taxpayers refuse to comply.