Indonesia's Mining and Energy Subsector Generates the Most Revenue from Royalties

The Ministry of Energy and Mineral Resources (ESDM) has recorded the realization of Non-Tax State Revenue (PNBP) from the mineral and coal sub-sectors over the past five years.

This realization trend is included in a copy of the Decree of the Minister of ESDM Number 301.K/MB.01/MEM.B/2022 concerning the National Mineral and Coal Management Plan 2022-2027.

The Ministry of ESDM stated that from 2018 to July 2022, PNBP increased and exceeded the established target.

"The decrease in the planned and realized PNBP from the previous year occurred in 2020 due to the global Covid-19 pandemic," wrote the Ministry of ESDM in the regulation.

Broken down by revenue item, the largest PNBP came from royalty income.

The value reached Rp29.77 trillion in 2018; Rp25.89 trillion in 2019; Rp20.75 trillion in 2020; Rp43.76 trillion in 2021; and Rp41.14 trillion in July 2022.

The second largest realization was from the sale of mining products. The details are: Rp19.31 trillion in 2018; Rp18.58 trillion in 2019; Rp13.46 trillion in 2020; Rp30.61 trillion in 2021; and Rp40.6 trillion in July 2022.

Below that is fixed fee income. The details are: Rp0.55 trillion in 2018; Rp0.45 trillion in 2019; Rp0.44 trillion in 2020; Rp0.52 trillion in 2021; and Rp0.64 trillion in July 2022.

Meanwhile, other PNBPs were only recorded for two years, namely Rp0.5 trillion in 2021 and Rp1.6 trillion in July 2022.

The Ministry of ESDM explained that before minerals and coal are shipped to buyers, business owners are obligated to pay production levies (royalties) and/or coal production funds (DHPB) with amounts and mechanisms in accordance with applicable regulations.

Business owners or permit holders are those who have obtained a Mining Business License (IUP), a Special Mining Business License (IUPK), an IUPK as a continuation of operations/agreement, a Contract of Work (KK), and a Coal Mining Business Work Agreement (PKP2B).

Meanwhile, DHPB consists of production levies (royalties) and sales of mining products (PHT).

"In addition to production levies (royalties), holders of IUP, IUPK, IUPK as a continuation of operations/agreements, KK, and PKP2B are also obligated to pay fixed levies based on tariffs and mechanisms in accordance with applicable regulations," wrote the Ministry of ESDM.