New levy a new burden for CPO producers<\/p>\n
JAKARTA (JP): Crude palm oil (CPO) producers are claiming the
\ngovernment's plan to impose a redeemable levy on the interisland
\nshipment of CPO and its by-products will cause them a heavy
\nfinancial burden.<\/p>\n
They said Saturday the new measure would take a big bite out
\nof their cash flows, since they would have to set aside a large
\nsum of money before they could deliver their shipments.<\/p>\n
Smaller companies which ship CPO products in large volumes to
\nother islands may find it hard to come up with the money
\nrequired, and may have to seek loans in order to raise the
\nsecurity deposit, they said.<\/p>\n
This will be costly to them since interest rates have shot up
\nto more than 50 percent.<\/p>\n
They said the measure would also add administrative burdens to
\nthe interisland trade of the commodity.<\/p>\n
The government announced last week that the interisland
\nshipment of CPO and its derivatives, oil fuel, fertilizer,
\ngarlic, cigarettes, rattan, and logs would be taxed to prevent
\nthe commodities from being smuggled out of the country.<\/p>\n
The levy rates have not been fixed but analysts estimate they
\nwill be equal to the export taxes to be imposed on the
\ncommodities.<\/p>\n
All companies shipping the commodities will have to put a
\nsecurity deposit equivalent to the products' export taxes in a
\nbank.<\/p>\n
Procedures<\/p>\n
The Directorate General of Customs and Excise will be entitled
\nto the deposit until the companies can produce proof that their
\nshipments have been delivered to the local destination. The firms
\nwill then be entitled to reclaim the money.<\/p>\n
There have been indications that these commodities, especially
\npalm oil products, are being smuggled out of the country to Hong
\nKong, Malaysia and Singapore to avoid the export taxes imposed by
\nthe government April 22 following the removal of the export ban.<\/p>\n
Export taxes for CPO and its derivatives range between 15
\npercent and 40 percent.<\/p>\n
CPO producer Navis Daulay said over the weekend, the new
\nsystem could also create an administrative burden for palm oil
\nproducers.<\/p>\n
The system would mean lengthy bureaucratic procedures in
\ndomestic trading, Navis, the chairman of the Association of
\nEdible Oils Industries, said.<\/p>\n
The Director General of International Trade at the Ministry of
\nTrade and Industry, Djoko Moeljono, said Friday the procedures to
\nobtain the deposit once the companies showed their proof of
\ndelivery could be completed within three days at the most.<\/p>\n
But Navis said the new system could encourage more collusion
\npractices among the customs and excise officials overseeing the
\nshipment levy.<\/p>\n
"If we have to deposit money with them (the customs and excise
\ndirectorate general), who knows if we will get back the whole
\namount in the end," Navis told The Jakarta Post in a telephone
\ninterview.<\/p>\n
Traders are also worried that officials will make companies
\npay extra fees to speed up the process.<\/p>\n
Navis suggested the government cancels the new system and
\ninstead improves the inspection of delivery shipments.<\/p>\n
The government should use its auditing company, PT Sucofindo,
\nto fully inspect all shipments from the ports where the
\ncommodities are embarked to the ports where they are unloaded, he
\nsaid.<\/p>\n
Those found to have smuggled the products must be punished, he
\nsaid. (das)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/new-levy-a-new-burden-for-cpo-producers-1447893297",
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"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
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