Exporters complain about exorbitant departure tax

JAKARTA (JP): Local exporters urged the government to lift or lower the Rp 1 million (US$125) departure tax imposed on Indonesians leaving the country by airplane to boost business activities, especially exports.

The chairman of the Indonesian Exporters Association, Amirudin Saud, said the high exit tax burdened exporters especially because they had to spend more money to promote products and negotiate with foreign buyers.

"Exporters have to go abroad at least three to five times a month to negotiate their exports and look for new buyers. The high departure tax has burdened them in boosting their export activities.

"If the government can not abolish the tax, at least they can lower it to a more reasonable level," he said at the sidelines of an exporters' meeting.

Amirudin said a zero departure tax was badly needed when Indonesia's non-oil and gas exports were declining.

"In the previous years, buyers came to us to procure our goods. But at present we are the ones who have to get foreign buyers. Foreign buyers are currently reluctant to buy our products because they fear the country's political stability could disrupt delivery," he said.

"Right now we have to make more negotiations as well as promotions to boost exports."

Amirudin said it would be better if the government abolished all kinds of departure taxes imposed on Indonesians traveling abroad.

"But if the government cannot do that, it should exempt Indonesian exporters traveling for business purposes from the departure tax, because exporters generate foreign exchange earnings for this country."

The government imposed the Rp 1 million departure tax, a 300 percent increase from Rp 250,000, from February of 1998 on Indonesians leaving the country by airplane in an unprecedented move to discourage overseas traveling.

Government Regulation No.17/1998 increased the departure tax imposed on those leaving the country via seaports 150 percent to Rp 500,000 from Rp 200,000. Leaving Indonesia overland costs Rp 200,000, compared to Rp 50,000 previously.

Indonesians with special status such as members of the diplomatic corps, government officials traveling on official business and members of sports and cultural missions remain exempt from paying departure tax.

Indonesia's exports of non-oil and gas declined by 2 percent to US$40.97 billion in 1998 from $41.82 billion in 1997.

The country's exports of non-oil and gas reached $8.2 billion during the first three months of this year, a drop by 19.3 percent compared to the corresponding period in 1998.

Amirudin, who is also chairman of the Indonesian Importers Association, said that the country's importers were facing hurdles in boosting imports performance due to the lack of container trucks to carry their goods.

Only 50 percent of the country's container trucks fleet were operating since transportation companies could not afford spare parts and maintenance costs for their trucks.

He said that the lack of container trucks to deliver goods has increased transportation costs by about 10 percent.

"It is currently difficult to get our goods transported. If there are any containers, they prioritize carrying exported goods to port, instead of delivering imported goods," he said. (gis)