Analysis of the effectiveness of tax dispute mediation as an effort to realize tax law justice

Abstract

The surging volume of tax disputes in Indonesia, reaching a record 390,822 cases in 2024, has heavily burdened the Tax Court and delayed legal certainty. This study examines the efficacy and normative barriers of the current adversarial litigation system and evaluates how tax mediation can be legally reconstructed to ensure substantive justice. Utilizing a normative juridical method with a statute and comparative approach, this research analyzes the current administrative review mechanism and the implementation of Ministry of Finance Regulation No. 15/2025. The results reveal that the existing litigation path positions taxpayers unfairly due to procedural complexions, high financial penalties, and institutional conflicts of interest. Furthermore, the quasi-mediation function of the newly established Quality Assurance Team remains inadequate due to structural dependence and limited material jurisdiction. This study concludes that the rigid zero-sum game approach in tax litigation undermines material justice, as evidenced by multinational transfer pricing disputes. Consequently, it is recommended that the Indonesian government urgently reform its tax laws by creating a formal legal framework for independent tax mediation, expanding the material scope of administrative reviews, and relaxing penal sanctions to foster a cooperative compliance environment