Government to consider non-tax state revenue in lowering gas price

Government to consider non-tax state revenue in lowering gas price


Jakarta (ANTARA News) - The decline in Non-Tax State Revenue (PNBP) from the gas sector will be taken into account if gas price for the industry is to be reduced, Coordinating Economic Affairs Minister Darmin Nasution stated.

"Decreasing the gas price for the industry will have consequences, as it will lead to a decline in the PNBP, so it is necessary to calculate it," Nasution stated after chairing a coordination meeting on gas prices for the industry in Jakarta on Wednesday.

Nasution noted that the Ministry of Industry is currently recalculating the potential decrease in non-tax revenues, so that the adjustment in industrial gas price does not significantly affect them.

"If it is lowered, the analysis of its benefits should be conducted. The benefits should not be small," he emphasized.

The government had earlier issued a third economic policy package in May 2016 that suggested a lowering of the gas prices for the industry.

The government then issued Presidential Regulation No. 40 of 2016 on the setting of natural gas prices at a level not higher than US$6 per million British thermal units.

The lowering of the natural gas price is intended for consumers doing business in industries, such as fertilizer, petrochemical, oleochemical, steel, ceramics, glass, and gloves.

However, until now, only three new industries -- fertilizer, steel, and petrochemicals -- are receiving the natural gas at a reduced price.

Deputy Minister of Energy and Mineral Resources Arcandra Tahar remarked that the decrease in PNBP will be carried out by also taking into account the reduction in cost in both the upstream and downstream gas sectors.

"In the downstream sector, we will see whether the expenditure can be streamlined, including the transmission and distribution costs, if the price is lowered," he stated.

However, he ensured that the decrease in non-state revenue in the gas sector is not too high, and the figure is still being recalculated by the Ministry of Industry.

"The reduction in state revenue is not too high. However, no figure has been agreed upon, and the Ministry of Industry is still filing data that can prove if the reduction in PNBP is attractive," he noted.