Indonesia’s government removed on June 8, 2018 income tax on sugar as part of its attempt to maintain the government’s purchasing price at Rp 9,700 (69 US cents) per kilogram.
The decision was made during a meeting at the State Palace in Jakarta attended by relevant officials and ministers.
Trade Minister Enggartiasto Lukita said the government preferred to remove the tax rather than increase the government’s purchasing price to Rp 10,500 per kilogram.
Meanwhile, the market’s ceiling price is now at Rp 12,500 per kilogram.
“We decided that the government’s purchasing price would stay at Rp 9,700 per kilogram, but without tax,” Enggartiasto said.
On June, representatives of the Association of Sugarcane Farmers of Indonesia (APTRI) met with Presidential Chief of Staff Moeldoko to report that sugar production costs now reached between Rp 9,700 and Rp 10,500 per kilogram.
They called on the government to remove income tax. The tax rate is 1.5 percent for farmers who are already registered as taxpayers and 3 percent for those not yet registered.
Meanwhile, in March, the Agriculture Ministry recommended that the National Logistics Agency (Bulog) increase the government’s purchasing price to Rp 10,500 per kilogram from the current price of Rp 9,700 per kilogram. (bbn)