Royal Golden Eagle director Anderson Tanoto. (ID Photo/Emral Firdiansyah)
Royal Golden Eagle Awaits Tax Holiday Approval
BY :DAMIANA SIMANJUNTAK
JUNE 13, 2017
Jakarta. Royal Golden Eagle, a local conglomerate focused on resource-based manufacturing industries, is still waiting for the government to waive the tax on its latest paper and viscose plants, which could reduce Indonesia's dependency on imported textiles, the group said on Monday (12/06).
Royal Golden's viscose making unit Sateri Viscose International will complete a viscose staple fiber plant by the end of June 2018. The plant will increase its capacity to 350,000 tons from today's 250,000 tons a year.
The group's pulp and paper company, April, is also building its third paper machine plant in Pelalawan, Riau Islands, which is going to start production in the next few months. The Rp 4 trillion ($300.89 million) plant will increase April's production capacity by 40 percent to 1.15 million tons of paper a year. April ships about 70 percent of its paper abroad.
"Since 2015, we have invested about Rp 15 trillion and the results will be seen in 2017 or 2018. The investment is part of our efforts to support the government in pushing downstream industries development in Indonesia," Royal Golden director Anderson Tanoto said.
"We are optimistic with the outcome of our tax holiday application," he said.
Under the latest tax holiday policy, government can waive five to 15 years of income tax for companies involved in specific pioneer industries. These industries include infrastructure investments, telecommunications and IT, basic chemical and agriculture production.
Harris Munandar, the head of the industrial research and development agency (BPPI) at the Ministry of Industry, said earlier that a government committee has recommended for Sateri Viscose International to get a six-year income tax break.
"That's because the plant is located in a remote area. Moreover, they will produce high grade digital paper and introduce new technology," Harris said.
Sateri plans to allocate 40 percent of its viscose production to the local market, which has long depended on foreign supplies.
The remainder of the production will be exported mainly to China, where in 2016 Sateri acquired a spinning mill from an Austrian company Linz Textil. It plans to expand the facility to broaden its portfolio.