Kadin urges govt to drop fuel limitation policy

By Godang Sitompul

The Indonesian Chamber of Commerce and Industry (Kadin), a powerful business lobby, has urged the government to review and if possible drop the recent policy which bans vehicles transporting goods from using subsidized fuel.

The policy, which has been effective since March 1, bans vehicles with more than four wheels used in transporting mining, forest, and plantation products from using subsidized automotive diesel. This is part of the government?s efforts to help limit costly fuel subsidy.

But Kadin Vice Chairwoman for Logistics, Carmelita Hartoto said Thursday that the policy has hampered the distribution of goods via land transport and increase the cost of logistics by 20 percent.

She said that Kadin wants the government to drop the policy. If the government wants to maintain the policy, businesses should be compensated via tax breaks such as vehicle related taxes.

Editing by Reiner Simanjuntak