Ahead of Carbon Tax Implementation in Indonesia: Projection, Impact, and What Business Can Expect

Ahead of Indonesia’s G20 Presidency scheduled to be held this December in Bali, President Joko Widodo has iterated that one of the key aspects for future survival is the global commitment to climate change mitigation. Under the theme “Recover Together, Recover Stronger”, he stressed that Indonesia is committed to achieving its Nationally Determined Contribution (NDC) of 29% (unconditional) and 41% (conditional) by 2030. The energy sector accounts for 11% to 15% of these NDC targets. The government aims to reduce 314 – 446 Mton CO2e from the energy sector by 2030. To achieve this, it introduces several regulations and mechanisms in the past few months, with carbon tax and future domestic carbon trading mechanisms becoming two that garnered much attention both from the national and international business community.

The government has scheduled April 2022 for coal-powered plant, and plans to gradually introduce the tax for other sectors in the next three years. yet there are plenty of questions among businesses, observers, and the public in the general about this regulation. 

Click on the following links to access the presentation materials:

• Denny Vissaro (Manager Fiscal Research of Danny Darussalam Tax Center
• Ilham, ST, MT (Analis Kebijakan Ahli Madya Deputi Bidang Koordinasi Pengelolaan Lingkungan dan Kehutanan