Government Eliminates Import Duty on LPG to Curb Plastic Prices

Jakarta, CNBC Indonesia - The Indonesian government has officially decided to waive import duties on LPG imports used as raw materials for the industry to substitute naphtha plastic pellets.

Initially, the import duty tariff imposed on liquefied petroleum gas (LPG) for industrial raw materials was 5%, but it has now been decided to reduce it to 0%.

“Reduced from 5% to 0%,” said Coordinating Minister for the Economy Airlangga Hartarto at his office in Jakarta on Tuesday (28/4/2026).

However, Airlangga emphasised that the implementation of this policy is still awaiting technical regulations to be issued by Finance Minister Purbaya Yudhi Sadewa and Industry Minister Agus Gumiwang Kartasasmita.

“Because refineries require it for plastic raw materials, the Ministry of Industry and the Ministry of Finance will prepare the regulations,” said Airlangga.

As is known, the industry had previously requested the government to waive import duties on LPG to address problematic plastic raw material issues at the global level, which has driven up prices.

PT Lotte Chemical Indonesia (LCI) is one of them. They asked the government to eliminate the LPG import tariff as a raw material for the industry. Currently, the 5% tariff burden is considered to burden the competitiveness of the domestic industry amid the global raw material supply crisis due to conflicts in the Middle East.

Corporate Planning General Manager LCI Lee Dae Lo stated that in other countries, such as Singapore, Malaysia, and Thailand, no import costs are imposed on LPG from other countries.

“In other countries like Singapore, Malaysia, and Thailand, there is no import tariff for companies importing LPG from abroad. For the competitiveness of the Indonesian industry, I hope that the LPG import tariff as a raw material can be changed to 0%,” said Lee in Jakarta on Tuesday (14/4/2026) as reported by detikfinance.