PRINSIP BASE EROSION AND PROFIT SHIFTING (BEPS) TERHADAP KEDAULATAN HUKUM PAJAK INDONESIA: KAJIAN LITERATUR

Abstract

This study analyzes the of the Base Erosion and Profit Shifting (BEPS) principle on Indonesia's tax sovereignty through a literature review. BEPS is a practice used by multinational companies to shift profits to low-tax jurisdictions, thereby reducing the potential tax revenues of the country where economic activity takes place. Indonesia, as a member of the G20 and the OECD Inclusive Framework, is trying to adjust its domestic tax system to international standards, including the implementation of regulations such as the Interest Limitation Rule (ILR) and Controlled Foreign Company (CFC) Rules to combat BEPS practices. However, a number of structural and administrative obstacles remain, such as regulatory inconsistencies in determining nexus and the use of cross-border digital transactions that exploit legal ambiguity. In addition, dependence on international regulations also has the potential to reduce national fiscal autonomy in determining incentive policies and strategic tax rates. Indonesia's efforts are also made through the reformulation of Income Tax regulations and adjustments to incentive policies, including adopting the principle of economic presence and global minimum rates. Although these steps demonstrate a commitment to international standards, major challenges remain to balance the principle of global solidarity and maintain national fiscal sovereignty. This study concludes that the successful implementation of the BEPS principle requires effective international cooperation and adaptive domestic regulatory reform so that tax sovereignty can be optimally maintained.