Coal export duty regulation faces delays amid opposition

The government has yet to finalize regulations on a proposed coal export duty after facing opposition from several parties, Finance Minister Purbaya Yudhi Sadewa said.

 “There are still some protests,” Purbaya told reporters in Jakarta on Friday (March 13), without specifying which groups were objecting or the substance of their concerns.

Despite the delay, the government is still targeting implementation of the coal export duty in 2026, with rates expected to range from 1% to 5%.

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Purbaya said the policy is needed to address fiscal imbalances in the coal sector after coal was reclassified as a taxable good, allowing mining companies to apply for value-added tax (VAT) restitution.

Instead of boosting state revenue, the scheme has created a fiscal burden for the government, he said, as the state may have to bear potential losses of up to around Rp 25 trillion annually due to the restitution mechanism.

The government views the policy as important to maintain fiscal fairness in the sector, Purbaya added.

Editing by Reiner Simanjuntak