Govt asked to drop incentives for oil and gas firms

The Association of Indonesian Pipe Makers (Gapipa) has asked the government to remove tax duties and other tax facilities given to local oil and gas producers in importing steel pipes, Bisnis Indonesia reported on Tuesday.

The association’s chairman Untung Yusuf said in Jakarta on Monday that the removal of such tax facilities was important to help improve the sales performance of the national pipe producers.

Local gas and oil producers are given tax incentives such as free import duties when importing pipes used either for their exploration and production activities or for their gas and crude oil distribution networks.

“The government should give equal treatment to all companies in the country. Actually, the government should give a priority on the use of locally made pipes for the country’s gas and oil pipelines,” he said.

At present, the association’s 15 members produces about 1.8 million tons of pipes a year, and about 25 percent of the total are sold to local oil and gas companies. (*)