From the beginning of 2014 the Indonesian government is charging an export tax on mineral concentrates. The aim is to raise the amount of domestic value added and increase domestic economic activity associated with the mineral sector. The government has suggested that it may in future reduce the export tax on mineral concentrates for any company that builds a smelter in the country but no regulations have yet been issued about this.
This has led to announcements by some copper mining companies that they will close some operations in Indonesia. In addition to the new export tax rates Indonesia is prohibiting raw mineral ore exports. In the case of minerals exported in concentrate form, specific tax rates are being levied, with copper especially hard hit. The plan is that these export taxes will be increased gradually until the beginning of 2017 when the exports of concentrates will be prohibited altogether.
