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Tax Incentives Considered For Indonesian Oil Industry

by Mary Swire, Tax-News.com, Hong Kong

23 March 2009

The Indonesian government is considering introducing a range of tax incentives to encourage the building of new oil refineries.

With domestic demand for oil increasing rapidly it is widely believed that the country needs to begin refining its own resources in order to reduce its reliance on imports.

The government is considering introducing a zero tax policy for construction inputs and income - an initiative proposed by oil and gas company PT Pertamina.

According to the company, two new refineries and an expansion of its existing site could be funded if the zero tax policy was to be implemented.

The decision currently rests with the Finance Minister.

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