Indonesia Introduces Coal Export Duty Effective January 2026

New Tax Policy Aims for Fairness

The Indonesian government has announced plans to implement a new coal export duty starting January 1, 2026. According to Minister of Energy and Mineral Resources, Bahlil Lahadalia, the duty will be calculated based on global coal prices. The specific tariff structure is still under discussion between the Ministry of Energy and Mineral Resources and the Ministry of Finance.

Price-Based Tariff Mechanism

The proposed tariff mechanism will feature different rates for different price ranges. For instance, coal exports might be taxed at one rate when prices fall between US$100-150 per ton, and at another rate when prices exceed US$150 per ton. Bahlil explained that this structure aims to ensure that the taxation is fair and reasonable for both the government and coal businesses.

Balancing Government Revenue and Industry Needs

The decision to link the export duty to global coal prices reflects the government's attempt to balance revenue generation with industry profitability. Bahlil emphasized that the government needs businesses to thrive while businesses need government support. The sliding scale tariff is seen as a middle ground that achieves this balance.

Implementation and Industry Impact

Although the exact tariff rates have not been disclosed, the retroactive application from January 1, 2026, means that calculations will be made from the start of the year. This move is expected to have significant implications for Indonesia's coal industry, which is a major contributor to the country's economy. The government has assured that the final policy will be fair and not overly burdensome for businesses.