Regarding Carbon Tax, Director General Of EBTKE: Harmonizing Two Regulations

Illustration. (Photo: Doc. Antara)

JAKARTA - The Ministry of Energy and Mineral Resources through the Director-General of New, Renewable Energy, and Energy Conservation (EBTKE) Dadan Kusdiana said, discussions regarding the implementation of a carbon tax (carbon tax) are still in the stage of harmonizing two regulations, namely regarding levies in the Presidential Regulation on Carbon Economic Values and the term carbon tax in the Tax Law.

"In terms of mechanism, because this will be involved later the Ministry of Finance and the Ministry of Environment and Forestry. We will also continue to coordinate this with the Kemenkomarves," he said, Monday, January 17.

Dadan continued, the Ministry of Finance and the Ministry of Environment and Forestry (KLHK) are also discussing whether to trade on the stock exchange or CoFTRA.

"There is also the possibility of opening a new institution for this mechanism," added Dadan.

For the initial stage on April 1, 2022, a carbon tax will begin to be imposed on the coal-fired power plant sector at a rate of IDR 30 per kilogram of carbon dioxide equivalent (COe2) or its equivalent unit.

The mechanism is by setting a cap or maximum emission limit for each sector and taxes will be set on emissions above that cap, not on the entire emission. The carbon tax is imposed in order to control greenhouse gas emissions to support the achievement of Indonesia's Nationally Determined Contribution (NDC).

Meanwhile, for carbon trading, Dadan continued, his party has not determined the exact amount of the price that will be subject to a fixed price but will be combined between supply and demand.

"There is no set price, but of course from the price stabilization perspective there must be a mechanism so that efforts to reduce greenhouse gases are achieved," he said.