SILO exempted from export duty

Out of the three mineral concentrate producers which have obtained export approval from the government including PT Freeport Indonesia, PT Lumbung Mineral Sentosa, and PT Sebuku Iron Lateritic Ores (SILO), only the latter would be allowed to make export without having to pay export duty, Investor Daily reported on Monday.

The paper quoted Director for Mineral Development and Management at the Ministry of Energy and Mineral Resources Edi Prasodjo as saying that SILO has been exempted from the export duty because construction progress of the company?s smelter has reached more than 30 percent as stipulated under the revised Minister of Finance regulation on mineral export duty.

The regulation stipulates that concentrate producers will have to pay export duty of 7.5 percent to make export if construction progress of their smelters is still below 7.5 percent, as is the case with Freeport Indonesia and Lumbung Mineral, Edi explained.

?Based on the revised MoF regulation, the export duty for SILO is 0%, while for Lumbung Mineral and Freeport is 7.5%,? Edi said over the weekend.

The government introduced in January of this year tighter export requirements for mineral concentrates including requiring producers to build domestic smelters and pay hefty export duty. But following months of protest, the government has recently decided to slash the export duty to 7.5 percent, which gradually declines up to zero percent depending on progress of the smelters. (*)