Government plans to hike export tax on mineral concentrates up to 20%

The Ministry of Energy and Mineral Resources is planning to hike the export duty on mineral concentrates to 15-20 percent next year from the current 0-7.5 percent in a bid to push miners to build domestic smelters, reports said on Monday.

Secretary General of the ministry Teguh Pamudji said that the higher export duty would be applied when the government implements a new policy next year, relaxing the current export ban on mineral commodities.

He, however, said that miners will be exempted from the export duty if construction progress of their smelter projects have reached at least 50 percent.

The government is currently finalizing the revision of Government Regulation No 1/2014, which bans the export of mineral commodities. Under the current regulation, mineral concentrates will no longer be allowed for export starting next year. But as miners such PT Freeport Indonesia have yet to complete their smelter projects, the government decides to relax the export ban policy, allowing miners to continue export of mineral concentrates for another 3-5 years, giving them extra time for completing their smelters.

In return for relaxing the export ban policy, miners will have to pay higher export duty of up to 20 percent, Teguh said. (*)