Coal Charges Constrained By VAT, This Is What The Minister Of Energy And Mineral Resources Said

Illustration of coal mining products (photo: dock. pexels)

JAKARTA - The establishment of a Management Agency Partner (MIP) as a substitute for the coal Public Service Agency (BLU) is hampered by the issue of imposing Value Added Tax (VAT) in the coal bill collection scheme.

Responding to this, Minister of Energy and Mineral Resources (ESDM) Arifin Tasrif said that this institution was formed to carry out a channel levy scheme and was intended to help each other between domestic coal entrepreneurs.

Later, the existing levies will be used to cover the difference in the selling price of domestic coal for those who carry out the Domestic Market Obligation obligation.

"If the nature of compensation helps each other, yes! They should fill each other in withdrawing and channeling," said Arifin to the media quoted on Saturday, March 25.

Arifin added, with the levy, VAT was no longer enforced because it was already in the previous scheme.

"We said that the principle of pulling the channel no longer has VAT. VAT has existed before. It is already in the sales process. There is already VAT," said Arifin.

For this reason, Arifin emphasized that his party is currently working with various related parties to equalize the understanding of MIP and finalize the cultivation of the channel.

"(The latest process) we are accompanying again so that the understanding is the same," said Arifin.

Previously in a joint working meeting with Commission VII DPR RI, Arifin also emphasized that the MIP as a substitute for the BLU was not related to Non-Tax State Revenue because its function was only to withdraw compensation obligations from companies that did not meet the DMO. This is because the resulting coal specifications are different from those needed.

"Then this is mutual cooperation between companies that are not DMOs holding companies assigned to DMO because not all of these companies can deliver DMOs because of the specs and abundances," Arifin explained at the DPR Building, Monday, March 20.

He also explained that the BLU that was previously planned to be formed was not working because it had a DMO obligation of 25 percent.

"This is an objection to entrepreneurs because they have submitted royalties, taxes and so on. For this reason, an alternative MIP is formed whose function is to withdraw and spread," concluded Arifin.