South Kalimantan suffers massive losses from royalty payment

The provincial administration of South Kalimantan cannot fully receive the royalties from the province’s mining companies due to the late implementation of the new mining regulation, Kompas reported on Wednesday.

Sukardi, the head of the province’s mining office, said in Banjarmasin on Tuesday that the local government should have received royalties amounting to Rp 100 billion from the mining sector, or about 80 percent of this year’s total mining royalty payment which was estimated to reach Rp 125 billion.

“But due the late implementation of the new regulation, the royalties to be received by South Kalaimantan government would total only Rp 53 billion,” he was quoted as saying.

According to him, under the revised mining law No. 33, 2004, the local government should receive 80 percent of the mining royalties, and the other 20 percent goes to the central government through the ministry of finance. However, the central government has yet to issue the implementating regulation of the new law and still uses the old law as the basis of the royalty payment.

As the result, the South Kalimantan government only receives Rp 53 billion of this year’s total royalty payment which is estimated to reach Rp 125 billion , he added. (*)