The need for energy sourced from coal is increasing. Unfortunately, the development of the coal gasification industry in Indonesia is still facing obstacles. According to Ragimun, a Postgraduate Program student in the Administrative Science Doctoral Program, Faculty of Administrative Sciences (FIA) Universitas Indonesia (UI), the obstacles in question are Capital Expenses (Capex) and Operational Expenses (Opex), expensive coal gasification technology that has not yet been implemented, as well as the lack of maximum Government support, especially fiscal incentives for industrial investment.
In order to eliminate these obstacles, alternative fiscal incentives and financing schemes need to be implemented. Providing fiscal incentives to this industry is expected to accelerate economic growth, increase tax revenues and create jobs. Ragimun suggested that the Government provide greater fiscal incentives, involve business cooperation between companies that own coal, and explore financing schemes through trust funds and alternative climate change funding.
Several fiscal incentive schemes that can be implemented include the provision of 0% coal mining royalties, the provision of tax allowances, tax holidays, exemption from Import Duty (BM) and suspension of Value Added Tax (VAT), as well as Special Economic Zone (KEK) facilities. In his dissertation, Ragimun analyzed the implications of providing fiscal incentives for national energy security. The research was conducted using mixed methods with a combination of qualitative and quantitative research with a Benefit Cost Analysis approach and an input-output (IO) model.
Based on the results of the IO model simulation, the provision of fiscal incentives provided by the Government to this industry has multiple implications (multiplier effect) for the Indonesian economy. Among other things, it can increase the growth of national Gross Domestic Product (GDP) and Gross Regional Domestic Product (GRDP) of South Sumatra where this industry is located, increase tax revenues such as Income Tax (PPh) and VAT in the future, as well as absorbing labor.
“The multiple implications of fiscal incentive policies in the coal gasification industry in the form of reducing 0% royalties, providing tax holidays, and setting prices for mine-mouth coal will affect the feasibility or economics of investment. These include increasing the Net Present Value (NPV), Internal Rate of Return (IRR) and shortening the payback period,” said Ragimun.
Thanks to the research entitled “Analysis of Fiscal Incentive Policy for the Coal Gasification Industry in Supporting National Energy Security”, Ragimun succeeded in obtaining a Doctorate degree from FIA UI. The promotion session was held at the 2020 EDITION Auditorium, FIA UI M Building on Monday (18/12). In the promotion session, Ragimun was declared to have graduated with High Satisfaction and succeeded in becoming the 36th doctorate from FIA UI and the 224th in Administrative Sciences.
This doctoral promotion session was chaired by Prof. Dr. Chandra Wijaya, M.Si., M.M. The promoter and co-promoter were Prof. Dr. Haula Rosdiana, M.Si. and Dr. Milla Sepliana Setyowati, M.Ak. The testing team included Dr. Machfud Sidik, M.Sc.; Prof. Dr. Irfan Ridwan Maksum, M.Sc.; Prof. Dr. Gunadi; Dr. Ning Rahayu, M.Si.; and Dr. Inayati, M.Si.
