Indonesian government announces update in export levy scheme
SIPEF would like to raise the attention to the recent announcement by the Indonesian government relating to the changes to the Indonesian export levy scheme for Crude Palm Oil (“CPO”), which are effective from 22 September 2024.
In the previous export levy scheme, the export levy was calculated as an incremental increase per 50 USD/tonne price band, depending on the published CPO reference price as set by the Indonesian Government. This approach has now been changed to a flat 7.5% export levy, calculated on the same published CPO reference price. The new export levy scheme results in lower levies compared to the old export levy scheme for every price band.
There is no change in the existing export tax scheme, which continues to be calculated in accordance with a 50 USD/tonne price band.
SIPEF does not expect that there will be a material impact from these changes. SIPEF sells CPO in the local Indonesian market, where no export levy or tax applies. However, local CPO prices are usually aligned with international prices, adjusted for delivery costs and export tariffs. As a result, changes in export tariffs and restrictions indirectly affect these local Indonesian selling prices.
The following link contains 2 tables relating to the export levy scheme.
Table 1 contains the current applicable scheme for the total export tax and export levy applicable per price band, with the export levy calculated as 7.5% calculated at the top of the price band. Table 2 contains the comparison of the old and the new export levy scheme, with the new export levy scheme calculated at the top of the price band.
For more information, please contact:
Petra Meekers, managing director
Bart Cambré, chief financial officer
Tel.: +32 3 641 97 00