income tax and pnbp regimes of mineral mining sector
- September 19, 2018
- Posted by: fuad
- Category: Consultant, Info 1, Tax News
On 2 August 2018, the Government issued a new regulation No: 37 year 2018 (“GR-37”) regarding the Treatment of Tax and/or Non-Tax Revenues in the Mineral Mining Sector.
The articles of this regulation apply to the holders of:
- Mining License (IUP);
- Special Mining License (IUPK);
- Smallholder Mining License (IPR);
- Special Mining License (IUPK) for Operational Production as a reform of an on-going Contract of Work; and
- Contract of Work (KK).
Basically, this regulation stipulates the applicable regimes of income tax (including the withholding tax) and non-tax revenue (PNBP) for the above license holders. This includes the method in recognizing business income (based on market prices), specific treatments of depreciation/amortization, deductible donation, debt-to-equity ratio, rights and obligations, as well as the rates and splits of PNBP revenue related to the mineral mining activities.
The provisions of GR-37 will be effective starting fiscal year 2019, except for IUPK for Operational Production holders (no.4 above) and KK holders (no. 5 above), which are bound to the income tax regime of the corresponding KK until it is completed.