Jakarta, Klinik Farma – The Ministry of Energy and Mineral Resources (ESDM) has also spoken out about the introduction of new export duties for mining companies that received waivers of mineral export licenses before May 31, 2024, including PT Freeport Indonesia.
sq. Muhammad Wafid, Director General of the Department of Minerals and Coal of the Ministry of Energy and Mineral Resources, emphasized that PT Freeport Indonesia (PTFI) must comply with the provisions on export duties, as specified in the Regulation of the Minister of Finance (PMK) No. 71 of 2023 regarding the provisions. export goods subject to export duty and export duty tariff.
In PMK No. 71 of 2023, PT Freeport Indonesia is subject to an export duty of 7.5%. This refers to the provisions of the PMK, where in the event that the physical development progress rate is less than 70% to less than 90% of the total construction volume, an export duty of 7.5% will be introduced between July 17 and December 31, 2023 and increase up to 10% from January 1 to May 31, 2024.
As for the construction progress of the PT Freeport Indonesia copper smelter in Gresik, East Java, it was reported that it had reached 75% by the end of July 2023.
“Yeah, that fits with the new PMK, right? It has to match that,” Wafid said during a meeting at the Ministry of Energy and Mineral Resources office in Jakarta on Monday (July 8, 2023).
In fact, based on the provisions of the PTFI Special Mining Permit (IUPK), which came into force in 2018, the company refers to the amount of export duty based on PMK No. 164 of 2018. In this ruling, PTFI will be exempt from export duty if the smelter has advanced more than 50%.
In response to this new export duty provision, PT Freeport Indonesia is also negotiating with the Indonesian government.
“PTFI is discussing the introduction of a revised fee by the Indonesian government. Under the IUPK PTFI, export-import duties are determined based on rules that came into effect in 2018, with the stipulation that no import duty is levied once the smelter reaches 50%,” Freeport McMoran Inc (FCX) wrote in the report. on performance and operations for the second quarter of 2023, quoted on Wednesday (07/26/2023).
As is known, in mid-July 2023, the Ministry of Finance issued the Decree on the Minister of Finance (PMC) No. 10. No. 71/2023 regarding the provisions on export goods subject to export duty and the export duty rate.
Based on the MQP No. 71 of 2023, the government sets tariffs or export duties on mineral products based on a minimum construction capacity of a smelter of 50%.
“Determination of the export duty rate for the export of processed metal mineral raw materials, as specified in paragraph (2), is based on the physical progress of the construction of processing facilities, which has reached at least 50%,” reads Article 11. paragraph (4) of the SQP 71 / 2023.
In PMK No. 71 of 2023, the introduction of export duties is divided into three stages in accordance with the stages of the physical progress of the construction of the plant. In particular, for the export of copper concentrate, the amount of export duties is:
– Phase I, in case the level of physical development is less than 50% to less than 70% of the total construction volume, the company will be subject to an export duty of 10% during the period from July 17 to December 31, 2023 and increase to 15% during the period from January 1 to May 31, 2024.
– Phase II, in the event that the level of physical development is less than 70% to less than 90% of the total construction volume, an export duty of 7.5% will be introduced between July 17 and December 31, 2023 and will increase to 10% in period from January 1 to May 31, 2024.
– Phase III, in case the progress rate of physical development exceeds 90% to 100%, the company will be subject to an export duty of 5% from July 17 to December 31 and increase to 7.5% from January 1 to May 31 2024
The stages of physical development are listed in the export guidelines issued by the minister responsible for government affairs for energy and minerals.
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