Gapki wants government to drop export tax on CPO<\/p>\n
JAKARTA (JP): Palm oil producers have called on the government
\nto erase the 10 percent export tax on the commodity, saying that
\na slowdown in sales has led to a massive stock buildup.<\/p>\n
The Indonesian Palm Oil Producers Association (Gapki) had
\nwritten to the Ministry of Finance to renew their demand, which
\nwas rejected on Feb. 2, Antara reported on Thursday.<\/p>\n
Gapki president Derom Bangun said abolishing the tax would
\ngreatly boost exports in a competitive global market, and noted
\nthat other palm oil producing countries had also accumulated
\nstock.<\/p>\n
Unless the government erases the tax, Indonesia will unlikely
\nmeet its targeted export of three million tons this year, he
\nsaid.<\/p>\n
Indonesia's reputation as a crude palm oil (CPO) exporter was
\ndamaged by the discovery in October of contaminated shipments in
\nRotterdam, the Netherlands, which were traced to Medan producers.<\/p>\n
Exports have since declined, leading to a huge stock buildup
\nin several production centers.<\/p>\n
About 85,000 tons of Indonesian palm oil shipped to Rotterdam
\nin September and October were contaminated with diesel oil. Some
\nof the tainted cargoes have since been returned.<\/p>\n
Derom warned that the current oversupply could make domestic
\nprices of CPO and fresh fruit plummet, further undermining the
\nnational palm oil industry.<\/p>\n
The government, which uses the export tax to secure enough
\ncooking oil for home, has gradually lowered the rate from 60
\npercent in early 1998, to 10 percent beginning in July.<\/p>\n
Rumors that the government was about to abolish the tax
\nbecause of massive stockpiles and more stable domestic cooking
\noil prices were dismissed by the Ministry of Finance on Feb. 2.<\/p>\n
Minister of Trade and Industry Yusuf Kalla said on Thursday
\nthat it had proposed cutting the export tax on CPO to 3 percent
\nfrom the current 10 percent level in order to boost exports.<\/p>\n
Kalla said he was waiting for a decision on the proposed tax
\ncut from finance minister Bambang Sudibyo.<\/p>\n
Indonesian exporters have repeatedly called on the government
\nto reduce the export tax in order to help kick start CPO exports,
\nwhich have tumbled since the contamination scandal broke last
\nyear.<\/p>\n
Indonesia expected to export at least 2 million tons of CPO in
\n1999, but the scandal led to a significant drop in exports,
\nexporters said.(10)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/gapki-wants-government-to-drop-export-tax-on-cpo-1447893297",
"image": ""
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"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
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