Member Of Commission VII of the DPR Asks BPK For A Complete Audit Of The Nickel Downstreaming Program

JAKARTA – Member of Commission VII of the House of Representatives (DPR) RI, Mulyanto asked the Indonesian Supreme Audit Agency (BPK) to conduct a thorough audit of the nickel downstream program that the government is currently pursuing.

Because until now, the government's statements regarding the nickel downstream program are considered only glorification which still has to be proven. Including, President Joko Widodo's acknowledgment that this program has not been profitable in the short term and will only taste good in the long term.

According to the President, through downstreaming RI's per capita income could accelerate in the next few years. Based on his calculations, in the next ten years, per capita income can reach IDR 153 million, in 15 years it will reach IDR 217 million, and in 22 years it will reach IDR 331 million.

"I doubt the amount of state revenue from this nickel downstream. Because of that, I urge the BPK to comprehensively audit this program," said Mulyanto in a written statement, Sunday (20/8).

He explained, previously the government had contrasted the nickel ore export revenue in 2019 of IDR 17 trillion with the export revenue of the nickel downstream program in 2022 of IDR 510 trillion. In fact, from data from the relevant ministries, it is known that state revenue from downstream nickel taxation in 2022 is only IDR 17.96 trillion, or around 3.5 percent of the total export revenue of IDR 510 trillion. Most of it as much as 96.5 percent went to the production process, workers and foreign investors.

Meanwhile, from exports of nickel ore in 2019, export proceeds of IDR 15.5 trillion were obtained. Of that value, state revenue from export taxes alone amounts to IDR 1.55 trillion or ten percent. Not to mention state revenue from Non-tax revenue (PNBP), VAT, and corporate income tax. Then too, the rest goes to national investors and miners.

"This means that in terms of percentage, state revenue from the nickel downstream program is much lower than direct nickel ore exports," added Mulyanto.

Not to mention, continued the politician from the PKS faction, if the state revenue is calculated based on the ratio of the tonnage of nickel ore dredged. It will become increasingly apparent that the country's profits from nickel downstream with the current model are still very low.

This is because 90 percent of exported products are semi-finished goods with low added value, namely NPI and Ferronickel. Meanwhile, the government provides lavish incentives, starting from the price of nickel ore for smelters which is half of the international price, corporate PPH tax holidays, export tax exemption, including the ease of bringing in machine tools and foreign workers.

Because of that, he considered it necessary to have accurate and objective data from the BPK audit. This is not just a unilateral claim from the Government, especially regarding data on state revenue from this nickel downstream program.

"This is important so that the nickel downstream program is on the track and can achieve its goals, namely increasing the added value of the natural resource economy and people's welfare," concluded Mulyanto.