The Government Strengthens The Focus Of Carbon Taxes Not To Increase State Revenue

Deputy Minister of Finance Suahasil Nazara (Photo: Capture PT SMI's Youtube screen)

JAKARTA - Deputy Minister of Finance (Wamenkeu) Suahasil Nazara said that the plan to implement a carbon tax actually has a very big essence for the economy in Indonesia.

According to him, the carbon tax is the main basis for the direction of national development in the future. Therefore, Suahasil said that the fiscal instrument was not only about the government's efforts to collect state revenues.

"Carbon tax is not a tool for seeking state revenue," he said while speaking at the Indonesia Economic Outlook 2023 forum organized by PT SMI on Tuesday, December 20.

Sri Mulyani's deputy also said that the carbon tax is proof of Indonesia's seriousness in fulfilling Net Zero Emission's commitments.

"This is a step to achieve reducing carbon emissions in each sector (business/business)," he said.

Suahasil explained, the new rules will encourage business actors to actively participate in the carbon market scheme. If it is considered quite heavy, entrepreneurs can also take other ways by providing compensation to the state through payment of a carbon tax.

The carbon tax is in the Law on Harmonization of Tax Regulations (HPP) together with other items. This is part of the structural reforms that we continue to carry out," said Suahasil.

According to VOI records, the rules regarding the carbon tax are contained in Law Number 7 of 2021 concerning Harmonization of Tax Regulations (UU HPP). In the initial implementation, this policy should have taken effect on July 1, 2022.

In fact, the government had planned to make the carbon tax a showcase and important achievement for Indonesia in the agenda of the G20 Summit last November.

However, taking into account the domestic conditions and the world economy, the government has finally decided to postpone the implementation of the carbon tax until 2025.