Govt increases forest lease tariffs, miners protest

The government will increase the tariffs of the so-called borrow and use of forest area for commercial purposes particularly for mining activities by up to nearly 50 percent to generate greater revenue from the forestry sector.

Director General of Forestry Planning at the Ministry of Forestry, Bambang Soepijanto said that the tariff increase is contained in the revision of Government Regulation No 2/2008 on non-tax revenue from forest use. ?The draft of the revision is currently waiting to be signed by President Susilo Bambang Yudhoyono,? he was quoted by Investor Daily as saying Tuesday.

According to the draft, the tariff for mining activities in protected forest will increase by 33.33 percent to Rp 4 million per ha per year from the current Rp 3 million tariff.

Meanwhile, the tariff for mining activities in production forest will increase by 45.83 percent to Rp 3.5 million per ha per year from Rp 2.4 million.

The revise regulation also stipulates a new tariff of Rp 2 million per ha per year for the use of forest areas for developing mining supporting facilities including infrastructure.

Meanwhile, Chairman of the Indonesia Coal Mining Association (APBI) Bob Kamandanu protested the tariff surge, arguing that it would ?kill? the domestic mining industry amid the current weak commodity prices. ?All miners will surely shutdown considering the current market downturn,? he was quoted by Bisnis Indonesia daily as saying.

Deputy Chairman of the Indonesian Mining Association (IMA) Clayton Allen Wenas that the new tariff will certainly put great financial pressure on mineral miners which have already been burdened by the new punitive export tax and the huge investment to build required domestic smelters. (*)