In a move to further regulate its raw mineral exports, the Indonesian government has announced that it will impose a 7.5% export tax on shipments of copper concentrate, effective immediately. This new tax applies to the two mining firms currently exempt from Indonesia’s ban on raw copper exports.
Indonesia has outlawed the shipment of raw copper since June 2023, but has allowed Freeport Indonesia and Amman Mineral Internasional to continue exporting until the end of 2024. This is to give them more time to complete the construction of their copper smelters.
The last export permits for Freeport Indonesia and Amman were valid until May 31. For their January-May shipments, the government had imposed a tax ranging from 7.5% to 15%, depending on the progress of their smelter construction.
Freeport Indonesia, which is majority-owned by the Indonesian government but operated by the U.S. miner Freeport-McMoran, declined to comment on the new 7.5% tax rate. A company spokesperson stated that Freeport Indonesia is still waiting for its new export permit.
Amman Mineral Internasional has not responded to requests for comment on the tax rate and the status of its new export permit.
The new export tax on copper concentrate shipments is part of Indonesia’s broader strategy to move its mining industry up the value chain and capture more of the economic benefits from its mineral resources. By imposing higher taxes on raw exports, the government aims to incentivize domestic processing and value addition before shipment.