Underinvoicing Practices Raise Concerns About Customs Effectiveness

Rising Cases of Underinvoicing

The Indonesian government is facing increasing scrutiny over the effectiveness of its customs operations due to a significant rise in underinvoicing practices. The practice involves understating the value of import transactions, which can lead to substantial revenue losses for the government. According to the latest data from the Directorate General of Taxes (DJP), there are currently 463 exporters suspected of underinvoicing palm oil commodities. This number represents a substantial increase from the 282 exporters identified in early November 2025.

Implications for Revenue and Trade

The surge in underinvoicing cases raises serious concerns about the ability of the Directorate General of Customs and Excise (DJBC) to effectively monitor and regulate the flow of goods into Indonesia. As the customs authority under the Ministry of Finance, DJBC plays a crucial role in ensuring compliance with import regulations and collecting appropriate duties. The increasing number of underinvoicing cases suggests potential weaknesses in DJBC's oversight mechanisms.

Government Response

The government is likely to face pressure to strengthen customs enforcement and improve monitoring systems to prevent further revenue losses. The rise in underinvoicing not only affects government revenue but also creates an uneven playing field for compliant businesses. As the situation develops, closer scrutiny of import practices and customs procedures can be expected.