Ministry Of Industry Calls Industrial Gas Price Fixing At US$6 Per MMBTU Will Boost Tax And Investment Revenue

Illustration. (Photo: Doc. Antara)

JAKARTA - The Ministry of Industry (Kemenperin) stated that the gas pricing policy of US$6 for the industrial sector per Metric Million British Thermal (MMBTU) contributed to tax revenue and investment.

"The contribution of tax revenue from the processing industry is supported by seven industrial sectors that receive a gas price adjustment facility of US$6 per MMBTU," said Industry Ministry Spokesman Febri Hendri Antoni Arif in a statement in Jakarta, quoted from Antara, Saturday, June 26.

Febri explained, the manufacturing industry showed a major contribution to the economy, one of which was through the realization of tax revenues.

In May 2021, taxes paid by the manufacturing sector grew 42.24 percent, or higher than April 2021 which grew 10.17 percent. On an annual basis (yoy), until the end of May 2021 the contribution of the processing industry to tax revenues also grew by 5.31 percent.

The seven industrial sectors that received gas price adjustments were fertilizer, oleochemicals, ceramics, petrochemicals, steel, glass and rubber gloves, which consisted of 176 industries.

The tax payments of the seven sectors have increased every year. For example, Income Tax (PPh) 21. In 2019, corporate income tax was recorded at Rp. 3.3 trillion, while in 2020 it rose to Rp. 3.4 trillion.

"This also shows the occurrence of a multiplier effect, that industries that receive certain natural gas price adjustments, in aggregate are able to maintain the number of employees during the COVID-19 pandemic, and are able to minimize layoffs," he said.

Furthermore, the income tax (PPh) of 22 exports in the seven sectors also increased. This indicates that there is an increase in exports and an increase in the competitiveness of products that are subject to certain natural gas price adjustments.

Meanwhile, import PPh 22 decreased. This is also influenced by the decline in imports of industrial raw material products, due to the use of substitutes in the form of local raw materials.

"This is supported by the fact that the growth of the chemical industry, the majority of which are raw materials for industrial products, in 2020 will reach 9 percent and oleochemicals by approximately 5 percent," said Febri.