Coal proposed to be exempted from valued-added tax obligation

The government has proposed coal be exempted from value-added tax, Kompas reported Wednesday.

 

Director General of Tax Darmin Nasution said in Jakarta Tuesday that the proposal has been included in the draft amandement to Law No. 18/2000 on Value-Added Tax.

 

“The law on value-added tax is being amended. We have proposed that coal become a non-taxable commodity and thus should exempted from valued-added tax obligation,” said.

 

According to Darmin, only coal that has just been mined or unprocessed one that will be exempted from the value-added tax obligation. “So, the processed coal is still subject to value-added tax obligation,” he said.

 

He said that the reason behind the government’s move to propose the value-added tax exemption is because the tax policy on coal has been a source of controversy. “In the past, coal was classified into untaxable commodity. But another law categorizes coal as taxable commodity” he said. (*)