Forest royalties set by April

JAKARTA (JP): The government will announce whether it will increase forest royalties by April 1, forestry minister Djamaludin Suryohadikusuma said yesterday.

"We will see the capability of forestry concessionaires to pay royalties before deciding on any increase," he said.

The government usually increases forest royalties twice a year -- in April/May and October. The last increase was 10 percent and came last September after a rise in plywood prices and inflation.

The government did not increase the royalties in April/May last year because of weak plywood prices on the world market.

Djamaludin said recently that the government wanted to increase royalties by an average of 5 percent in line with rises in world timber prices.

The rates of forest royalties vary depending on the location of the resources. Forests easily accessible at places with good facilities will be charged higher royalty rates.

For example, royalties on timber from Sumatra, Kalimantan, Sulawesi and Maluku are now set at Rp 25,900 a cubic meter, while royalties on timber from Irian Jaya, East Nusa Tenggara, Bali and East Timor are set at Rp 20,900 a cubic meter.

The Director General of Forest Utilization, Titus Sarijanto, said discussions were still in progress.

The government collected Rp 593 billion (US$247 million) in forest royalties last year 1996, up from Rp 539 billion in 1995 and Rp 428 billion in 1994.

The main provinces contributing forest royalties last year were Central Kalimantan (Rp 95 billion), East Kalimantan (Rp 87 billion), West Kalimantan (Rp 32 billion), Riau (Rp 39 billion) and Irian Jaya (Rp 28 billion).

According to a government decree, 45 percent of royalties will go to local administrations, 20 percent for land and property tax, 15 percent for national forestry development and 20 percent to the state coffers. (10)