Indonesia Plans Export and Windfall Taxes on Coal and Nickel to Ease Subsidy Burden

Deep News
May 05

Indonesia is preparing to impose export duties and windfall taxes on coal and nickel as part of efforts to counter rising subsidy costs in the national budget. Finance Minister Purbaya Yudhi Sadewa stated that the proposed measures are still under discussion with the Ministry of Energy and Mineral Resources. "Consultations with the Energy Ministry are ongoing, but it is clear that the resulting revenue will be sufficient to help bridge the subsidy gap," he noted. Purbaya pointed out that coal and nickel exports had previously been excluded from export tax regulations, creating a loophole that could encourage under-invoicing and smuggling. This gap also limited the ability of customs authorities to inspect goods before shipment. The implementation of export taxes is expected to grant the Directorate General of Customs and Excise greater authority to conduct pre-shipment inspections, thereby helping to close tax loopholes and prevent revenue loss. Despite the government's plan to introduce these tax measures, Purbaya affirmed that the administration remains committed to promoting downstream industrial development, particularly in the nickel-based battery sector.

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