Balikpapan parliament to summon local Pertamina unit

The Balikpapan parliament in East Kalimantan will summon the local unit of the state-owned oil and gas company Pertamina to demand the latter to provide the so-called third party contribution fund to increase the revenue of local administration.

The Radar Kaltim daily said that the House would make the summon on June 20.

The paper said that the move followed by the recent decision of the local parliament to form a special team that would push huge companies operating in Balikpapan to contribute more to the efforts in increase the revenue of the local administration.

The paper quoted the legislators as saying that the move was in line with the spirit of the regional autonomy policy, which gives provinces, regencies, or districts to freely manage their own economic affairs including raising revenue for development.

The autonomy euphoria, however, has created concern among investors operating in the regions as local administration has tended to issue new taxes and levies, which could force business to pay double tax both to local administration and the central government.(*)