Oil and gas sector taxes must be revised: Kadin

Indonesia?s Chamber of Commerce and Industry (Kadin) has urged the government to review tax regulations in oil and gas sector because these rules are considered disincentives to the industry, the Bisnis Indonesia newspaper reported in its Thursday edition.

The review was necessary since production sharing contractors were already overburdened by various taxes like exploration tax, customs duty, value added tax and income tax on imported capital goods, Kadin?s deputy chief for energy and resources Dito Ganinduto said in Jakarta on Tuesday.

"They have to pay tax for exploration activities despite that the activities will not necessarily lead to production on commercial basis.

"It is said that the value added tax imposed at the time of exploration phase can be reimbursed within 100 days. But in reality, it is completely different,? Dito said.

He further said there was a need for the revision of Ministerial decree No. 234/2003 regarding overtime, employment of foreign workers and work permits for foreign workers. (*)