Govt to ease export duty on mineral products

Following months of intensive protest from miners, the government has finally decided to ease the punitive export duty on mineral concentrates as a form of incentive to push for the development of domestic smelters, reports said on Thursday.

Vice Minister of Finance Bambang Brodjonegoro was quoted as saying, however, that the reduction in the export duty would only be given to miners which are making significant progress in the construction of the smelters.

?The higher the stage of construction, the lower the export duty, they have to pay,? he said as quoted by The Jakarta Post.

Speaking to reporters following a meeting at the Office of the Coordinating Minister for the Economy, he said that the government also plans to provide fiscal incentive in the form of tax allowance to the miners to help accelerate the construction of the smelters as the government wants the smelters to be ready in 2017.

Following the introduction of the export ban on mineral ores in January of this year, the government still allows for certain mineral ore concentrates such as copper concentrates to be exported until 2017. But the concentrates are imposed with a progressive export tax of 20-60 percent, which has been strongly protested by the miners including copper giants such as PT Freeport Indonesia and PT Newmont Nusa Tenggara, which yet to make any export since January.

Meanwhile, Head of the Indonesian Gold and Copper Association, Natsir Manysur, criticized the planned reduction in the export duty as a half-hearted policy as it is attached to a number of requirements that must be met by the miners.

The Energy and Mineral Resources Ministry said earlier that it had submitted a study proposing that the export duties should not be more than 10 percent, a level that is considered affordable for mining companies. (*)