Tax Rights & Obligations That Mining Entrepreneurs Should Notice!

The Minister of Finance affirms the taxation rights and obligations of Mining Business License (IUP) holders and their business partners. In addition to being obliged to acknowledge, impose, and deposit taxes on income from mineral sales, IUP holders and business partners are also entitled to calculate certain costs incurred as a deduction of taxable gross income. 

According to the provisions, IUP holders, People's Mining License (IPR), and Special Mining Business License (IUPK) which are a continuation of Contract Operations or Contract of Work (KK) are entitled to mineral production results, including accessory minerals, by-products, processing and/or purification products,  or residual results of refining mineral mining commodities in mining areas permitted by the central government or the provincial government.

In the process, those mining license holders are allowed to cooperate with each other, and/or other parties.

However, the Minister of Finance stressed the importance of implementing tax rights and obligations in accordance with applicable regulations. The tax rights and obligations of mining license holders include:

1. recognize the income for all sales/transfer of mineral production results in calculating income tax;
2. charge expenses related to obtaining, collecting, and maintaining income from the cooperation activities as a reduction in gross income in calculating taxable income;
3. carry out withholding and/or collection of taxes;
4. calculate the amount of tax payable;
5. make payment and/or settlement of the underpayment of tax payable;
6. submit a Tax Return that has been filled out correctly, completely, clearly, and signed; and/or
7. other tax rights and obligations, in accordance with the provisions of laws and regulations.

This affirmation is contained in the Minister of Finance Regulation (PMK) Number 61/PMK.03/2021, which is the implementing rule of Government Regulation (PP) Number 37 of 2018 on Tax Treatment or Non-Tax State Revenue (PNBP) in the Mineral Mining Business Sector.  This regulation has been effective since its promulgation, which is on 7 June 2021.

 

Peraturan Menteri Keuangan (PMK) Nomor 61/PMK.03/2021; Kementerian Keuangan