No change in duties on propylene

No change in duties on propylene

NEW YORK (Reuter): PT Tri Polyta Indonesia said aggregate duties on propylene and polypropylene will not change as a result of the tariff package announced by the Indonesian government on June 3.

However, the company said in a statement released in New York Wednesday that its propylene imports will become subject to a tariff. And the effective tariff for polypropylene converters which have been granted an incentive exemption will double.

Prior to this package, Tri Polyta said, the aggregate duties on propylene and polypropylene were 25 percent and 40 percent, respectively.

The propylene duty had consisted of a 5 percent tariff plus a 20 percent surcharge. Polypropylene duty consisted of a 20 percent tariff and a 20 percent surcharge.

With the implementation of this new package on July 1, Tri Polyta said, the surcharge on both propylene and polypropylene will be reclassified and rolled into the existing tariffs.

Once the changes become effective on July 1, imports of propylene by Tri Polyta under the incentive exemption scheme granted in conjunction with the third train expansion and the debottlenecking of the first two production trains will be subject to 50 percent of the tariff, or 12.5 percent.

To date, the company said, it has paid no tariff or surcharge for imports under this scheme.

Secondly, there will be an impact on the cost of imported polypropylene for converters who have been granted a similar incentive exemption scheme, Tri Polyta said. Converters in this category represent the second largest market for polypropylene resins in Indonesia, it noted.

These converters will be subject to 50 percent of the revised tariff of 40 percent, or 20 percent, on imported polypropylene. Previously, they were exempt from the 20 percent surcharge but were subject to 50 percent of the 20 percent tariff on their imports.