Indonesia provides new incentives to boost oil, gas sector

The Indonesian government is set to provide new incentives to boost investment and exploration in oil and gas sector in the country.

Under the new incentives, the government will free import Value Added Tax (VAT), domestic VAT, property tax and import duties for oil and gas mining firms during exploration period, Finance Minister Sri Mulyani told a press conference in her office here on Friday.

Similar tax revocations will also be applied on mining firms during their production periods, highly expected to further improve the project's economical aspect.

The minister said the government will also free the income tax (PPh) on amount of cost sharing. The cost comes from the use of government's necessities in upstream oil and gas production by oil and gas firms.

The PPh elimination will also be applied on the mining firm's overhead cost allocation spent by their head office in Indonesia, she added.

"With this, we expect oil and gas sector would be more attractive and new investments would emerge in Indonesia," the minister said.

Source : XINHUA