Bukit Asam delays local tax payment until autonomy law begins effective

The South Sumatra-based coal producer PT Bukit Asam said that it had halted payment of all local taxes until the government issued regulations on the implementation of the autonomy law, which will began effective next year, Sriwijaya Pos reported.

The head of the company's legal and administrative division, Muliarto said in Palembang on Tuesday that the payment of local taxes including the distribution levy imposed on the provincial administration of Lampung would be made only after the issuance of the regulations.

The decision to delay the payment of local taxes and levies was based on the instruction letter issued by the then state minister for state enterprises and investment, which required state companies not to many any business commitment with provincial administration before the issuance of the regulation.

The local administration will be given wider authority to manage and operate their financial resources as well as in collecting taxes or levies under the new autonomy law, which will become effective next year. The new law will be affective after the government issues regulations, which will stipulates guidelines and procedures on the implementation of the law.

The coal mining company's president RA Sunardi was recently angered by the Lampung provincial administration to charge Rp 3,000 for every ton of goods transported through the province and another Rp 10,000 for every tons of goods piled in the provincial area.

But the Lampung provincial administration later said it understood the coal mining company's objection and then offered the company a 50 percent discount for the payment of the fee for its coal stockpiles at the Tarahan coal terminal in the province.

The company, which operates a mining area in Tanjung Enim, South Sumatera but ship its coal through Tarakan coal terminal in Lampung, has to pay a numerous tax and fees to the two provincial administrations. (*)