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Government, investors still differ on gross split tax scheme
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Energy and Mineral Resources Deputy Minister Arcandra Tahar (JP/Dhoni Setiawan)
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nergy and Mineral Resources Deputy Minister Arcandra Tahar has said the government has not finished drafting a tax regulation on the gas and oil sector because of differences between the government and oil and gas investors on the gross split scheme.
Initially, the government planned to issue the regulation in July, he told reporters during a factory visit in Serang, Banten on Tuesday.
Oil and gas investors represented by the Indonesian Petroleum Association (IPA) want the government to maintain the ruling as stipulated in Government Regulation No.79/2010 in which the government will reimburse exploitation and exploration costs, said Arcandra.
Read also: Govt to settle taxation issue for gross split scheme soon“The idea is to set one flat rate for the producers. We will give them a tax holiday as their production starts. When their production rates go up and they begin earning profit, we will then tax them,” he said.
He said the idea of the Energy and Mining Resources Ministry was supported by the Finance Ministry.
“IPA, on the other hand, prefers to take all costs into account before establishing the tax rate,” he added.
The ministry was still looking for middle ground to solve the disagreement, Arcandra said. (dea/bbn)
