Forestry ministry to join campaign to remove levies
Forestry ministry to join campaign to remove levies
JAKARTA (JP): Minister of Forestry Djamaludin Suryohadikusumo
affirmed yesterday that his office would join in the government's
drive to remove excessive levies imposed on businesses.
Djamaludin said his office was currently making a list of such
levies, both on local and national levels, to determine which
were unnecessary and thus could be eliminated.
He did not give details as to when his office would finish its
inventory process.
"Presently forest concessionaires are subject to only three
mandatory fees-- reforestation funds, forest royalties and
concession fees. We will see what other fees exist and whether
they are necessary or not," he said.
Reforestation funds and forest royalties are aimed at ensuring
that forests are managed in an environmentally-sound manner.
Their amounts depend on the species and volume of timber felled.
A concession fee is determined by the area in hectares managed by
a forest concessionaire.
Djamaludin agreed that many fees which burden forest-based
businesses, especially at the local level, could actually be
eliminated.
Djamaludin's pledge to remove these fees came as a response to
President Soeharto's recent call on local administrations to
revoke all regulations on levies which created market distortions
and hampered economic growth.
Soeharto said that if necessary, a presidential decree to
eliminate such levies would be issued.
Businesses in forest-based industries have been complaining of
excessive levies, especially at the local level, imposed on their
timber.
Aside from levies on the timber itself, forest concessionaires
have to pay other fees related to regulatory paperwork. To obtain
government approval for an annual logging plan, for example,
concessionaires have to conduct various social programs and pay a
number of locally-imposed fees.
These fees are often not directly related to forestry, but are
imposed by local administrations as a means of collecting funds
for local development projects, such as infrastructure projects.
Businesses have been increasingly critical of the levies --
both legal and illegal -- which are imposed by various ministries
and local administrations across the country.
Minister of Manpower Abdul Latief recently took the lead in
the government's campaign against levies by pledging to cut back
37 kinds of fees currently imposed within the manpower
administration.
The manpower ministry's survey of companies in various
provinces recently showed that legal and illegal fees --
including bribes -- accounted for 20 to 30 percent of companies'
production costs.
Business analysts estimate that the levies make up 30 to 40
percent of production costs. (pwn)