Indonesia to Levy Coal Export Tax in 2012

SHANGHAI, Dec. 28 (SMM0 -- Mohamad Hidayat – President of Indonesian Chamber of Commerce and Industry – said Indonesia will levy coal export tax in 2012, so as to stimulate mining investment.

Mohamad Hidayat stated: "We are going to push forward development of metal and downstream coal industries with the supporting policy of export tax. We hope to levy coal export tax in 2012".

Indonesia has been considering levying export tax to fire coal at power plants, but they are expecting strong objections in the industry. Indonesia mainly produces low quality coal, and export to India and China.

As coal resources imported from Indonesia account for a large amount in domestic coal exports, import costs will significantly increase once Indonesia levies coal export tax next year. Domestic coal imports will be significantly affected with effects depending on tax rate.