Govt to remove tax on log products: forestry minister

Forestry Ministry Zulkifli Hasan said the Finance Ministry had agreed to proposals to remove value-added tax (VAT) imposed on log products.

He claimed former finance minister Sri Mulyani Indrawati had signed a proposal to cancel the tax when she was in the office.

“[Mulyani] agreed to cancel VAT for log products. The regulation will take effect this month. This is good as it will not burden industries because raw materials were not supposed to be taxed,” he said Sunday.

Zulkifli added that with the regulation, industry could increase production. Industry players have complained about the 10 percent tax, saying it would reduce the competitiveness of the country’s forestry products.