Definition of corruption

  • Corruption is The act of corrupting or making putrid, or state of being corrupt or putrid; decomposition or disorganization, in the process of putrefaction; putrefaction; deterioration.
  • The product of corruption; putrid matter.
  • Corruption is The act of corrupting or of impairing integrity, virtue, or moral principle; the state of being corrupted or debased; loss of purity or integrity; depravity; wickedness; impurity; bribery.
  • Corruption is The act of changing, or of being changed, for the worse; departure from what is pure, simple, or correct; as, a corruption of style; corruption in language.

As we have known, corruption is the case that almost happen in several country. Corruption never decrease but always increase from year to year. Only few country that could escaped from this big case. India is one of countries that could escaped from the problem of corruption beside that, Iran on the contrary become more exist in the group of corruption country.

In this session, we will explain about corruption in Indonesia. Indonesia of course one of countries that has a big problems, that is corruption.

“Only Indonesians can overcome corruption in Indonesia. They will do so if persuaded that

they must. Careful studies exposing in detail the systems, networks, and social and economic

costs of corruption are essential tools in the anti-corruption campaign. Will, as Buddha

noted, attends knowledge.”

-Gary Goodpaster

Indonesia is the first position of corruption country from six teen countries in asia pasific. This survey depend of consultant company “Political & Economic Risk Consultancy” (PERC) in Hongkong at 8th of march 2010. And in the world, Indonesia held in 110th position from 178 countries that being survey. In the last year Indonesia held the 111th position in the world.

These is arrangement of corruption country from that survey :

  1. Indonesia (most corrupt)
  2. Kamboja (corrupt)
  3. Vietnam (corrupt))
  4. Filipina (corrupt)
  5. Thailand
  6. India
  7. China
  8. Taiwan
  9. Korea
  10. Macau
  11. Malaysia
  12. Jepang
  13. Amerika Serikat (clean)
  14. Hong Kong (clean)
  15. Australia (clean)
  16. Singapura (most clean)

In 2008 indonesia  was  in third position, but in two years indonesia  not be better  but become worse and placed indosiaa become the first position of corruption country.

Corruption in Indonesia is widespread and costly (Macon, 2004). Based on the detailed survey this paper utilizes, in 2001 firms report spending on average over 8% of costs on bribes and over 10% of management time in “smoothing business operations” with local officials. Corruption in Indonesia is a major on-going political issue with wide press coverage and public discussion and has been a focus of both World Bank (2003) and local academic (Kuncoro, 2003) study. But the extent of corruption varies enormously across local jurisdictions, with, for example, the average of bribes to costs ranging from .56% to 31% across localities in the survey. We view bribes as a form of compensation for local government officials, which is planned, or least anticipated by local governments. Bribes paid are based on the extent of “red tape” at the local level, where the extent of red tape is set locally. This paper focuses on two issues. First we argue and present evidence that the extent of local red tape depends on local fiscal situations, as determined by central government policy. Localities receiving relatively fewer transfers from the central government rely more on corruption, or bribes, to help pay the salaries of their employees and hence enact more red tape to facilitate bribe activity. Fortunately to enable identification of such effects, in Indonesia because of oddities in the national tax-transfer system, in our data on local fiscal budgets, there is wide variation in the extent of fiscal transfers from the center as a fraction of local GDP. Second in this paper, we detail aspects of the nature and costs of corruption at the local level which support our model and assumptions, showing how money and time costs vary as the local red tape a firm faces varies.

In Indonesia, the everyday corruption most firms face involves interaction with local officials, who

administer regulations and indirect taxation. These are district (kabupaten) level officials, where a district is similar in geographic scope to northeast US counties. Our survey examines corruption for the year 2001,which is at the dawn of full local democratization.

In 2001, Indonesia switched away from a unitary form of governance and decentralized enormous responsibilities to district governments, under local assemblies that were democratically elected in 1999 in Indonesia’s first democratic election. We view the red tape in place in 2001 as having been implemented prior to decentralization, based on local governance and fiscal situations in the late 1990’s; and we present evidence to that effect. In a subsequent paper using a data set on corruption in 2004, we examine the effects of decentralization and local politics on corruption in 2004 and on the (dramatic) changes in corruption between 2001 and 2004 (Henderson and Kuncoro, 2006). But this paper is focused on how the instrument of corruption, red tape, is set in the pre-decentralization era before full local democracy, in part being driven by fiscal transfer arrangements with the central government.

To understand the potential link between corruption and fiscal arrangements, we think of the government of a district as hiring local officials to administer regulations, as well as provide services. For the moment, let the government of a district be embodied in the bupati, who is the head of the district government and in 1999 was appointed by the center (although that changes with bupatis first being elected by local assemblies and then by direct vote in later years). The district government has a local property tax base, where de facto tax rates are capped at low levels; and fiscal transfers are modest. It is widely acknowledged that revenues from tax and transfer sources both before and after decentralization are insufficient to pay for even minimal mandated public service levels, so the local government needs to seek other forms of revenue. Local red tape such as licenses and “levies” provide indirect revenues in the form of bribes, as well as direct revenues. Bribes received by local officials to ameliorate the impact of red tape mean the local government can pay lower salaries to officials; i.e., expected bribes received are capitalized into lower official salaries. [This does not say whether the freed up money is used for best purposes; below we model that explicitly.] The use of red tape and corruption to provide local revenues is not without consequence. Increased red tape and bribe demands make a locality unattractive to firms, driving firms to other districts and lowering the tax base of the district. Greater fiscal transfers from the center reduce the need to rely on corruption.

One of the examples of the corruption cases is about Gayus Tambunan, a former tax officer, who has been implicated in tax mafia case, on Wednesday was indicted with four charges that may lead him to be imprisoned for up to 20 years.

“The maximum jail sentence (for Gayus) is 20 years in jail,” State Prosecutor, Rhein Singal, was quoted by as saying after a hearing in the South Jakarta District Court.

The State Prosecutors read out formal indictment against Gayus Tambunan on Wednesday. He is indicted with four cases – tax mafia for his involvement in dealing with appeals of large tax payers; judicial mafia for bribing police investigators; bribing judges and giving false information.

Gayus was accused to have violated article 2, verse (1), Article 18, of the Law on Corruption and article 55 verse (1) of the Criminal Law. Gayus was accused to have implicated in acting against the law, enriching oneself or others or a corporation that caused losses to the State.

Gayus was indicted along with 4 other higher level tax officials, including Humala S.L. Napitupulu and Maruli Pandpotan Manurung. They were accused to have taken bribe and as a result tax payers who were supposed to pay tax, did not pay tax.

Gayus was also charged to have misused his power that caused losses to the State. Gayus, together with lawyer Haposan Hutagalung, was charged to have “given or promised to give something to State officials, namely Police, including police officer Arafat Enanie.”

Thirdly, Gayus is charged to have violated article 6 verse (1) letter (a) of the Corruption Law for giving or promised to give something that could influence the judges   decision or verdict. Gayus was charged to have given US$40,000 to judge Muhtadi Asnun in order to let him free. The court has begun the trial of suspects implicating in the Gayus Tambunan tax mafia case. The other suspects who are being and will face court trial in relation to the Gayus Tambunan tax mafia cases are including Andi Kosasih (tax broker), Gayus lawyer Haposan Hutagalung, case broker Sjahril Djohan, Alif Kuncoro, Lambertus, Muhtadi Asnun (judge), police officer Sri Sumartini and Arafat as well as State Prosecutors Cirus Sinaga and Poltak Manurung.

Gayus along with other suspects have been detained for alleged corruption and money laundering worth Rp28 billion. Gayus faced trial at the Tangerang District Court early this year, however he was set free in March, sparked public uproar and suspicion that Gayus has bribed legal officers including prosecutors, judges, senior police officers, etc. It was Susno Duadji, former National Police Detective Chief, who revealed the tax mafia case to the public. However, Susno’s move displeased his colleagues, prompting the police to put Susno in custody until now.

On Monday, suspect M. Arafat Enanie, a police investigator, was indicted for his involvement in the Gayus case and face four years jail sentence. The court has also asked Arafat to pay fines of Rp150 million.

The State Prosecutors accused Arafat to have received money in relation to money laundering and corruption. He is accused to have received Rp2 million, US$2,500 and US$3,500 separately from the Gayus lawyer. He also accused to have received money worth Rp100 million from Roberto S. Antonius, a tax consultant.

The revelation that Gayus Tambunan, the junior tax officer at the center of a major corruption investigation, has been going in and out of his Jakarta detention cell during five months under police custody, illustrates that justice and freedom are commodities that can be had in this country, for the right amount of money.

Behind the laughter upon seeing Gayus wearing a wig that barely concealed his identity while watching an international tennis tournament in Bali is actually a feeling of revulsion that many people must feel today, not so much at Gayus as at our justice system.

The Gayus investigation has lived up to its original billing as a case of mafia practice in the courts of law. The revelation about his daily sojourns outside his cell tells us that many others under detention or those already convicted for crimes have also been doing it. Gayus tells us that everybody is on the take: The police, the prison wardens, the government prosecutors, the judges and the lawyers. His presence at the tennis match also attended by tycoon/Golkar chairman Aburizal Bakrie raised some questions. Gayus, as we know, had moonlighted as a tax consultant for Bakrie to fix his tax refunds.

Effects of corruption :

  1. loss of Iease money which ought to be used to build public facility, so that the society did not got their rights.
  2. adulterated our state prestige and image in international.

From the text above, we can conclude that corruption is the worst act in the world. We can say the corruption is the act of impairing integrity, virtue, or moral principle. Because of corruption, Indonesia being more destroy.  Indonesia held in the first position as the most corrupt country in asia. Of course, that is not a good achievement for our country. As what we told before, according to Gary’s opinion that “Only Indonesians can overcome corruption in Indonesia . So, we must fight the corruption in our country and for the governments, they have to more obvious to face this big case. This case never clear without consciousness and initiative from Indonesian people.


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