On 11 April 2025, the Government of Republic of Indonesia has enacted a new regulation, i.e., the Government Regulation No. 18 of 2025 on Amendment of Government Regulation No. 15 of 2022 on Tax and/or Non-Tax State Revenue Treatment in Mining Sector (“New Regulation”).
The New Regulation amends the Government Regulation No. 15 of 2022 on Tax and/or Non-Tax State Revenue Treatment in Mining Sector (“Old Regulation”) to improve legal certainty on tax and non-tax state revenue regulations in mining sector, specifically for the holders of Special Mining Business License as continuation of Coal Contracts of Work (“IUPK as continuation of CCOW”).
The New Regulation provides several amendments to the Old Regulations among others concerning the income calculation and modification of tariffs. These amendments will be further elucidated in the subsequent section.
Highlights of The New Regulation
- Income Calculation
The New Regulation eliminates paragraph (6) of Article 4 which previously stated that if there is no benchmark on the coal benchmark price or coal index price, then the calculation will be calculated by using the actual price. This deletion is insignificant as it should not alter the interpretation of Article 4’s paragraph (3).
- Modification of Tariffs
As previously governed under the Old Regulation, the holders of IUPK as continuation of CCOW is required to pay non-tax state revenue for coal production. The New Regulation has amended the applicable rates according to the classification.
The below table sets out the new applicable non-tax state revenue for coal production of holders of IUPK as continuation of CCOW under the New Regulation:
| Benchmark Price for Coal (Harga Batubara Acuan or “HBA”) | Contract which specifies its own tax and non-tax state revenue provisions | Contract which refers to applicable regulation on the tax and non-tax state revenue provisions |
| HBA < USD 70 per ton | 15% | 15% |
| HBA ≥ USD 70 per ton up to < USD 120 per ton | 18% | 18% |
| HBA ≥ USD 120 per ton up to < USD 140 per ton | 19% | 19% |
| HBA ≥ USD 140 per ton up to < USD 160 per ton | 22% | 22% |
| HBA ≥ USD 160 per ton up to < USD 180 per ton | 25% | 25% |
| HBA ≥ USD 180 per ton | 28% | 28% |
According to the above table, the New Regulation sets new classification for the non-tax state revenue based on the coal benchmark price. As apposed to the Old Regulation, the New Regulation generalize the rates applicable to: (i) contract which specifies its own tax and non-tax state revenue provisions; and (ii) contract which refers to applicable regulation on the tax and non-tax state revenue provisions.
Closing
The New Regulation which has become effective on 26 April 2025 intends to create more certainty concerning the tariff to be imposed on coal income taxation. Furthermore, it facilitates the possibility of further amendments by incorporating an additional clause that stipulates the government’s periodic evaluation of the regulation’s implementation.
For further information, please contact:
MetaLAW, Legal & Tax Consultant, Jakarta, Indonesia
general@metalaw.id
