Bukit Asam still refuses to pay levy imposed by Lampung province

The South Sumatra-based coal producer PT Bukit Asam said Saturday that it still opposed to pay coal distribution and piling levies imposed by the provincial administration of Lampung province, Republika daily reported on Monday.

The head of the company's legal administration department Mulianto said on Saturday that the coal producer could not meet the province's demand because according to the existing regulation the company could not make any payment to local provinces until the government issues a regulation on the implementation of autonomy law, which will become effective next year.

He said an instruction letter issued by State Minister for Investment and State Enterprises early this year asked state companies not to make any business commitments to local provinces until there is a clear guideline on the implementation of autonomy law.

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 on the implementation of the law.

Lampung provincial administration has issued a new regulation on local taxes in which the distribution of mining products passing through the province is subject to a levy payment of Rp 3,000 for every ton. The piling of the mineral product is also subject to a levy payment of Rp 10,000 for every tons.

He said that the new levy could cost the company Rp 104 billion a year, comprising of Rp 24 billion for the payment of distribution levy and Rp 80 billion for the piling of the coal.

PT Bukit Asam, 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. (*)