Government to revise timber royalties
Government to revise timber royalties
JAKARTA (JP): The government announced on Saturday the new
floor prices used to calculate the royalties imposed on the
country's timber companies.
Minister of Industry and Trade Rahardi Ramelan said the new
floor prices based on wood prices during the second half of 1998
and their trends in the first half of this year would be
effective for the period from Jan. 1 to June 30.
The floor prices of big diameter logs such as 'meranti' from
Sumatra, Kalimantan, Sulawesi and Maluku are set at Rp 640,000
(US$75.3) per cubic meter, while those from Irian Jaya, East and
West Nusa Tenggara, Bali and East Timor are Rp 530,000 per cubic
meter.
Mixed wood from Sumatra, Kalimantan, Sulawesi and Maluku is
fixed at Rp 360,000 per cubic meter while that from Irian Jaya,
East and West Nusa Tenggara is Rp 265,000 per cubic meter.
The floor price of sandalwood is set at Rp 7 million per ton,
other fancy wood logs at Rp 905,000 per cubic meter, while teak
logs are floor-priced at between Rp 192,000 per cubic meter and
Rp 764,000 per cubic meter, depending on diameter.
The payment of royalties, officially called resource royalty
provision, is based on the wood's standard selling prices, which
are determined periodically by the Ministry of Industry and Trade
after taking into account wood prices on the domestic and
international markets.
The royalties are set in a range of one to 6 percent of the
wood floor prices.
The royalty which should be paid to the government from the
sales of big diameter logs such as 'meranti' and mixed tropical
wood from Sumatra, Kalimantan, Sulawesi, Maluku, Irian Jaya, East
Nusa Tenggara and East Timor is set at 6 percent per cubic meter.
A 6 percent royalty per cubic meter is also imposed on fancy
woods, such as teak, ebony, and sandalwood. And it is also
imposed on every ton of large diameter rattan, while a zero-
percent tax will be charged on small-diameter rattan.
The government also imposes a 1 percent royalty for every
cubic meter of wood with a diameter less than 30 centimeters.
The government charges a 5-percent royalty on wood from
industrial forests, such as pine, acacia, balsa and sengon.
In addition to resource royalty provisions and concession
fees, timber companies are still required to pay reforestation
funds, to encourage them to manage forests in an environmentally
sustainable manner.
The government expected to collect Rp 566 billion from
resource royalty provisions in the current 1998/1999 fiscal year.
(gis)