Two suspects named in PT Toba Pulp Lestari transfer pricing case

Indonesia's Attorney General's Office has named two suspects in a corruption case involving alleged transfer pricing by PT Toba Pulp Lestari (TPL) between 2008 and 2025. The suspects include two tax officials from the Directorate General of Taxes.

According to the Director of Investigation for Special Crimes, Saiful Bahri Siregar, TPL exported products by under-invoicing them. The company reported the goods as paper grade pulp or bleached hardwood kraft pulp (BHKP) instead of their actual classification as dissolving pulp, which has a higher market value. This misclassification involved changing the HS Code for exports.

"The HS Code for exports has changed," Siregar stated at a press conference Wednesday. He explained that this alteration in reported product value meant that the sales of dissolving pulp, marketed as High Alpha Pulp to PT Asia Pacific Rayon or its affiliates, were not properly recorded. "This resulted in a decrease in the corporate tax value that should have been received by the state."

To facilitate this scheme, TPL allegedly enlisted the help of suspects BP and SR, tax officials who supervised TPL's tax audits. These officials are accused of neglecting their supervisory duties and failing to properly review tax reports, basing their assessments on suspect-prepared reports rather than audits. Both suspects reportedly received money from TPL for their involvement.

Siregar stated that the state has incurred financial losses due to the reduced tax revenue. "Based on our investigation, the preliminary estimated loss is Rp 2 trillion, and the official figure will be provided by the auditing team," he said. The suspects face charges under the new Criminal Code and have been detained for 20 days.