Council gives OK to groundwater tax
Damar Harsanto, The Jakarta Post, Jakarta
Amid mounting concern over environmental problems resulting from the overuse of groundwater, the City Council agreed on Wednesday to pass a groundwater tax bylaw.
"The council accepts the draft (of the bylaw) as it is part of efforts to curb environmental damage from groundwater overexploitation, not an effort to increase city revenue," said council head Agung Imam Sumanto during Wednesday's session to hear from all factions on the bylaw.
Councillor Dadang Hamdani of the Indonesian Democratic Party of Struggle (PDI-P), reading his faction's statement, said the use of groundwater by businesses -- including hotels, offices, malls, apartments and industrial companies -- had gotten "out of hand" and "lacked control and monitoring".
Environmentalists have blamed the overexploitation of groundwater for much of the environmental damage in the capital, including land subsidence and seawater intrusion.
The PDI-P faction cited a gubernatorial decree that states that all buildings being serviced by city tap water operator PD PAM Jaya must only use groundwater as a backup.
The National Mandate Party (PAN) faction said residents preferred to use groundwater rather than tap water because PD PAM Jaya and its foreign partners failed to provide clean water to customers.
"The tap water supply only covers 57 percent of the need of the city's eight million residents," said PAN faction member Haim Mahadin.
The new bylaw, which will replace Bylaw No. 10/1998, maintains the groundwater tax at 20 percent but imposes a lower tax of 10 percent on surface water. The old bylaw stipulated that both the groundwater and surface water taxes were 20 percent.
The groundwater tax will be determined by water table measures, location of the water and whether the area is also served by the city's tap water operator.
Rental houses and boarding houses that use more than 50 cubic meters of groundwater per month will also be subject to the tax.
Groundwater used by private households, places of worship, farms and fish farms will be excluded from the tax.
Several factions warned the administration that it must improve its control and monitoring to ensure the tax is properly administered.
"It is not easy to impose a tax (on groundwater), since we have found the rampant bribery of officials by taxpayers," the United Development Party (PPP) faction said.
The PAN faction said this bribery had cut into the city revenue.
"The administration must find solutions to reduce such practices. It can, for instance, order different officers to cross-check tax amounts, or by periodically rotating the officers," it said.
The administration has targeted an increase of 16 percent in tax revenue from groundwater and surface water, from Rp 48.6 billion last year to Rp 56 billion in 2004.