Government Gives Nine Stimulus To Maintain Oil And Gas Investment

Photo illustration (Source: Antara)

JAKARTA - The government has provided nine stimulus packages as an effort to maintain the performance of the investment climate in the upstream oil and gas sector.

"We are taking steps so that there is no greater decline in oil and gas investment in Indonesia. There are nine stimuli that have been and are being processed," said the Head of the Special Task Force for Upstream Oil and Gas Business Activities (SKK Migas) Dwi Soetjipto in a written information. received in Jakarta, Saturday, October 24.

The stimulus that has been implemented is the postponement of abandonment and site restoration (ASR) activities. From the incentives that have been given by SKK Migas, there are 30 oil and gas contractors who have enjoyed the relaxation of the delay in depositing ASR funds this year.

Furthermore, there is a delay or abolition of value added tax (PPN) for liquefied natural gas (LNG) through the issuance of revised PP 81/2015 concerning Import and / or Delivery of Certain Taxable Goods that are Strategic in Nature Exempted from VAT Imposition; abolition of rental fees for upstream oil and gas state-owned goods (BMN); as well as gas sales at discounted prices for all the schemes above take or pay (TOP) and DCQ.

The government has also made fiscal adjustments (flexibility) by providing incentives for a certain time limit, such as accelerated depreciation, temporary split changes, and full price DMO.

Meanwhile, the ongoing stimulus package consists of a tax holiday for income tax in all oil and gas working areas and a delay or reduction of up to 100 percent of indirect taxes.

"This will be discussed between the Directorate General of Oil and Gas (Ministry of Energy and Mineral Resources), the Directorate General of Taxes (Ministry of Finance), the Directorate General of Budget (Kemenkeu), and the Fiscal Policy Agency (Ministry of Finance)," Dwi explained.

There is also an elimination of the cost of utilizing the Badak LNG Refinery of US $ 0.22 per MMBTU, which is currently being discussed between SKK Migas, LMAN, and the assessment team of the Directorate General of State Wealth of the Ministry of Finance.

Finally, the support from the ministry that fosters upstream oil and gas support industries (steel, rig, service and service industries) for the discussion of taxes for businesses supporting upstream oil and gas activities.

"Quite a few things have been prepared so that upstream oil and gas investment in Indonesia will be better," said Dwi.