Govt to fine coal miners if they sell coal below market prices

The government has threatened to impose a penalty on coal KP (Kontrak Pertambangan) holding miners which sell their coal at below market prices to avoid tax payment, and will also take them to court if they manipulate their sales and production for a similar purpose, Kompas reported on Tuesday.

Director General of Goal and Geothermal at the Ministry of Energy and Mineral Resources Bambang Setiawan said in Jakarta on Monday that his office had decided to issue the penalty warning because many coal miners had intentionally sold their coal at below market prices to avoid tax payment.

?A number of coal miners have been found to have sold their coal below market prices and all of them had been given penalty,? he said, adding that his office had also sent a circular to local governments to help his office monitor sales transactions carried out by coal miners in their respective province.

He also said the central government will forbid regional governments from issuing new KP contracts until after the government issued governmental regulations to implement the new Mineral and Coal Law No. 4/2009.

According to the ministry's data, the regional government had thus far issued 2,513 KPs, 623 of them have come into operation.

Bambang noted however that the existing KPs would remain valid until their expiry date, while the KP miners that have rececived exploration permits can continue their activities through exploitation phase.

Currently, the government is drafting four governmental regulations to implement the 2009 Coal and Mineral Law. The regulation will respectively governs mining zones; coal and mineral business activities; mining control and supervision; and reclamation and post-mining period.(*)