Six major coal mining companies refuse to pay their royalties
Wednesday, June 7 2006 - 02:31 AM WIB
"The total royalty arrears of these major coal miners have reached about Rp 3.9 trillion," the director for coal and mineral exploration and production at the ministry of energy and mineral resources, M.S, Marpaung said.
According to Minister of Energy and Mineral Resources Purnomo Yusgiantoro, these mining companies have been strongly warned to pay their royalty arrears but they
still refused to settle the royalty arrear payment on the ground that the government had not reimbursed their tax payment.
"Some of them have even taken a legal approach and sued the government through the state administrative court," he said.
The ministry's Director General of Coal and Geothermal Simon Sembiring said that under the government?s regulation No. 144/2000, the first generation coal mining companies including six coal miners are exempted from value added tax (VAT) payment.
"Under this regulation, the government has to reimburse their VAT payment. But the tax office has refused to do so due to different perception of the tax law. This is why the six coal mining companies delayed the payment of their 13.5 percent royalty to the government," he said.
According to the association of the coal mining companies, Jeffrey Mulyono, under the revised tax law, which is now still waiting for an approval from the House of Representatives, the tax exemption given to the first generation of coal miners would be removed, meaning that all coal mining producers in the country would be required to pay value added tax.
"The government, however, still has to reimburse the value added taxes paid by coal mining companies during the period between 2001 and 2006 despite the revision of the tax law," he said, adding that the tax reimbursement should be made so that the six mining companies would be able to settle their royalty payment. (godang)