The Government Imposes Safeguard Duty on Fructose Imports

The government will impose safeguard duty on imports of fructose syrup product or sugar derived from fruits, as stated in the Minister of Finance Regulation (PMK) number 126/PMK.010/2020. 

Safeguard duty is an additional import duty imposed on goods for a specific purpose. In this case, a safeguard duty is imposed on fructose syrup to limit imports of fructose syrup.

The restriction is necessary because based on the investigation of the the Indonesian Trade Safeguard Committee (KPPI), the soaring number of fructose syrup imports is harming the domestic industry.

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Subject to Safeguard Duty

Specifically, fructose syrup products that will be subject to safeguard import duty, namely, fructose syrup, in a dry state which contains fructose above 50% in weight, not invert sugar and is included in the tariff heading 1702.60.20.

With the imposition of safeguard duties, the import duty of fructose syrup will be higher than the general import duty or Most Favored Nation (MFN), for three years.  The rates will be valid for three years, it is 24% in the first year, 22% in the second year, and 20% in the third year.

Exception

However, not all imported fructose syrup goods will be subject to safeguard duty.  In this regulation, the government exempts the imposition of safeguard duty on imports from certain countries.

The government has determined 124 countries that are exempted from the imposition of safeguard import duty, as attached in the regulation.

If fructose syrup is imported from an excluded country, then the importer must submit a Certificate of Origin, so that it will not be a subject to safeguard import duty. 

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Referring to data from the Ministry of Trade, in the last four years (2015-2018), the import volume of fructose syrup products that were requested for protection has continued to increase with a trend of 18.99%. The import volume during the last four years was 67,244 tons, 106,566 tons, 138,997 tons, and 109,884 tons, respectively.

The countries of origin for the import of fructose syrup products include China, Philippines, and other countries. The largest import of fructose syrup products came from China, with an import share in 2018 of 94.01 percent, then in 2017 of 98.06 percent, and in 2016 of 91.69 percent of total import of fructose syrup products.