Govt Hoped Consistent With Downstream Palm Oil Rules

JAKARTA – The Indonesian government has managed to create  conducive condition in the palm oil industry, which has increased new investments, transfer of technology, job opportunities  and other multiplier effects to the national economy. The key factor to such success is its consistency in implementing all prevailing regulations in the palm oil industry.

The Indonesian Oleo-chemical Producers Association (Apolin) Chairman Rapolo Hutabarat said that the consistency in implementing the regulations is badly needed in the industry. “Apolin hopes the government will continue to be consistent in implementing the finance ministry regulation (PMK) No.191/2020 to maintain the current momentum and increase the competitiveness of the national palm oil industry,” he said.

“Indonesia as the world’s largest producer of CPO (crude palm oil), CPKO (crude palm kernel oil) and other derivative products has managed to control the global market, in terms of export volume and product varieties, and penetrate other new markets. The success is the result of the government’s unabated consistency in implementing all prevailing regulations in the Indonesian palm oil industry,” said Rapolo Hutabarat.

He said that all industrial players hope that the Indonesian government will keep its consistency in implementing the prevailing regulations in the downstream palm oil industry. First, the government should not revise the palm oil export duty stipulated in the PMK No. 191/PMK.05/2020.

Rapolo pointed out that the regulation has been totally accommodating various interests in the whole industries of palm oil, from upstream to downstream ones (from initial downstream, mid-downstream and further downstream or oleo-chemical industry).

“Besides, the PMK 191/2020 also accommodates other interests, such as the availability of funds to finance the replanting program for smallholders, research programs, positive campaigns, and advocacy fees,” he noted.

According to Rapolo, the main benefit of the PMK No.191/2020 is its function to maintain the balance between the need of domestic downstream industries in securing availability of raw materials and the need for exports to earn foreign exchange for the state income.

Second, PMK No.130/PMK.010/2020 on the facility to reduce the corporate income tax. This is popularly known as tax holiday, which provides facilities of income tax reduction up to 100% for a period of time based on the amount of investments with the longest one is for 20 years for investments of Rp ≥ 30 trillion.

After the end of certain grace periods, the investors are still given reduction facility up to 50% for the next two years. (*)

Source: KONTAN.CO.ID | Featured image via rainforest-alliance.org

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