Govt to re-impose VAT on coal, other mining products
Friday, October 21 2005 - 01:44 AM WIB
Government said on Thursday it would impose value added tax (VAT) to mining products including coal in the revised VAT law that was expected to be enacted next year.
?Under the proposed Amended VAT Law all mining products would subject to 10 percent VAT,? Director General of Tax Hadi Purnomo was quoted by Tempo daily as saying.
Tax office since 2001 had exempted mining products especially coal from VAT, arguing that the products do not have value added. The policy had caused mining coal mining companies unable to reclaim VAT they had pain for goods and services they procured.
Indonesian Coal Mining Association complained that the policy created additional costs of around 10 percent to coal mining companies.
The VAT Law amendment would be deliberated in the House of representative and is expected to take effect next year.(*)