Govt to introduce fishing tax to boost state revenue

JAKARTA (JP): The government plans to introduce a fishing tax in the immediate future to raise revenue from the country's rich fishery sector, according to Minister of Maritime Exploration Sarwono Kusumaatmadja.

Sarwono said on Monday the Ministry of Finance and his office were currently in the process of finalizing the ruling on the new tax.

Speaking at a media conference following a meeting with senior economic ministers, he said the fishing tax would probably be set at around 2.5 percent of production.

"Until now, the fishery sector has not contributed to state revenue because there has been no ruling on a fishing tax," he said.

He also said the government would introduce a new ruling on foreign vessels fishing in Indonesian waters, although he did not indicate what this ruling might be.

Sarwono also said the government was planning to introduce a control, monitoring and surveillance (CMS) system, primarily designed to curb the rampant theft of Indonesian maritime resources.

He said the US$500 million CMS system would be implemented on a trial basis in July.

He said the government would finance 10 percent of the total investment in the system, with the remaining 90 percent coming from the private sector.

He said four private companies and a foreign company from France were ready to participate in the trial phase of the system.

Sarwono stated the country suffered large losses from the theft of its maritime resources, with illegal fishing alone costing the central government some Rp 1 trillion ($126.58 million) per year.

He said the new CMS system would also help curb the rampant smuggling of fuel and illegally cut logs.

"If we can have an effective CMS system, we can save around $3 billion per year," he said.

He added that with an effective CMS system, the value of the country's fish exports could be increased to around $6 billion per year from the current $2.2 billion.

"You can imagine the huge benefits of the CMS system to our country," he said.

Sarwono said the country's fishery sector had been neglected by the previous government.

He stated that this was due to the relatively small contribution the fishery sector made to the state budget, a result of the fact that the government did not impose taxes on fishing activities.

President Abdurrahman Wahid introduced the Ministry of Maritime Exploration in a bid to raise revenue from the country's maritime resources. (rei)