KBC’s shareholder released from jail

A shareholder of the controversial Karaha Bodas Company (KBC), LSP -- who was under the custody for not paying taxes -- was released from the Cipinang jail on Friday at around 10 in the morning, the Koran Tempo newspaper reported in its Monday edition.

Cipinang jail’s chief warden Djoko Mardjo, who revealed the information to Koran Tempo regarding the release of LSP, said the release was based on a letter from the Minister of Finance Jusuf Anwar that LSP cleared all his tax dues to the government.

LSP was earlier put under detention known as ‘gijzeling’ on Tuesday. Under this provision a person can be detained for six months.

In the minister’s letter, it was stated that LSP paid Rp 1.2 billion on Thursday. LSP through his company owns 10 percent stake in KBC. As per the tax office figures KBC didn’t pay its tax dues of Rp 12.2 billion. That’s why he, paid Rp 1.2 billion as his part.

This was also confirmed by director of investigation at the Directorate General of Taxation Gunadi.

“In fact, there was a letter from Pak Minister,” Gunadi said, while refusing to reveal more details about the release.

Due to the 1997 financial crisis, the government closed down the KBC’s geothermal power project in West Java. But KBC filed an arbitrary case against Pertamina and won the case. With interest, KBC's claims reached $299 million. Neither the government nor Pertamina had paid the money to KBC, arguing the KBC marked up its investment in the project.

According to tax authorities KBC didn’t pay its taxes since 1999. (*)