Regional Regulation of the Special Capital Province of Jakarta No. 1/2004 RE Taxes on the extraction and use of groundwater and surface water

TAXES ON THE EXTRACTION AND USE OF GROUND WATER AND SURFACE WATER (Regional Regulation of the Special Capital Province of Jakarta No.1/2004 dated March 10, 2004) THE GOVERNOR OF THE SPECIAL CAPITAL PROVINCE OF JAKARTA, Considering: a. that the use of ground water and surface water in the Special Capital Province of Jakarta is provided for in Regional Regulation of the Special Capital Province of Jakarta No.10/1998; b. that following the enactment of Law No.34/2000 on Amendment to Law No.18/1997 on Regional Taxes and Levies, and of Government Regulation No. 65/2001 on Regional Taxes, provisions on taxes on the use of ground water and surface water in the Special Capital Province of Jakarta have been revised; c. that taxes on the use of ground water and surface wa ter are not merely meant to raise local income but more importantly, they are designed to conserve the environ ment and maintain the ecosystem due to the use of ground water and surface water; d. that in conjunction with the matters in letters a, b and c, to lay legal foundation for the collection of taxes on the use of ground water and surface water, it is neces sary to restipulate provisions on the use of ground wa ter and surface water by means of regional regulation; In view of: 1. Law No.11/1967 on the Principles of Mining (Statute Book of 1967 No.22, Supplement to Statute Book No. 2831); 2. Law No.11/1974 on Irrigation (Statute Book of 1974 No.65, Supplement to Statute Book No.3037); 3. Law No.18/1997 on Regional Taxes and Levies (Statute Book of 1997 No.41, Supplement to Statute Book No. 3685) as has been amended by Law No.34/2000 (Stat Business News 7065/28-5-2004 ute Book of 2000 No.246, Supplement to Statute Book No.4048); 4. Law No.23/1997 on Environmental Management (Stat ute Book of 1997 No.58, Supplement to Statute Book No.3699); 5. Law No.22/1999 on Regional Government (Statute Book of 1999 No.60, Supplement to Statute Book No.3839); 6. Law No.25/1999 on the Financial Sharing between the Central Government and Regional Governments (Stat ute Book of 1999 No.72, Supplement to Statute Book No.3848); 7. Law No.34/1999 on the Government of the Special Capi tal Province of Jakarta (Statute Book of 1999 No.146, Supplement to Statute Book No.3878); 8. Government Regulation No.65/2001 on Regional Taxes (Statute Book of 2001 No.118, Supplement to Statute Book No.4138); 9. Regional Regulation of the Special Capital Province of Jakarta No.3/2001 on the Organisational Structure and Work Mechanism of Regional Apparatuses and Secre tariat of the Legislative Council of the Special Capital Province of Jakarta (Regional Gazette of the Special Capital Province of Jakarta of 2001 No.66); 10. Regional Regulation of the Special Capital Province of Jakarta No. 4/2002 on Genera\ Provisions on Regional Taxes (Regional Gazette of the Special Capital Province of Jakarta of 2002 No.75); By the approval of THE LEGISLATIVE COUNCIL OF THE SPECIAL CAPITAL PROVINCE OF JAKARTA DECIDES .... , DECIDES: To stipulate: REGIONAL REGULATION OF THE SPECIAL CAPITAL PROV INCE OF JAKARTA ON TAXES ON THE EXTRACTION AND USE OF GROUND WATER AND SURFACE WATER. CHAPTER I GENERAL PROVISIONS Article 1 Hereinafter referred to as: 1. The Region is the Special Capital Province of Jakarta. 2. The Regional Government is the Government of the Spe cial Capital Province of Jakarta. 3. The Governor is the Governor of the Special Capital Prov ince of Jakarta. 4. The Regional Income Office is the Regional Income Of fice of the Special Capital Province of Jakarta. 5. Bodies are groups of persons and/or capital that consti tute units, either those that run business or those that do not run business, including limited liability company, limited partnership, other partnership, state-owned com pany/regional government-owned company in any name and form, firm, cooperative, pension fund, federation, association, foundation, mass organisation, socio-politi cal organisation or the like, institute, permanent estab lishment, and other bodies. 6. Ground water is water that is found under the ground, including spring that emerges naturally to the surface. 7. Surface water shall be water that is found in the sur face, excluding sea water. 8. The extraction and use of ground water and surface water is the extraction and use of ground water and surface water by individuals or bodies to meet various needs of companies, offices and households. 9. Taxes on the extraction and use of ground water and surface water are taxes on the extraction, use, and ex traction and use of ground water and/or surface water in the interests of indivlduals or bodies. Business News 706Sl?R-i; 2004 CHAPTER II NAME, OBJECT AND SUBJECT OF TAXES Article 2 Taxes called taxes on the extraction and use of ground water and surface water shall be imposed on the extraction, use, and extraction and use of ground water and/or surface water. Article 3 ( 1) The objects of taxes on the extractiori and use of ground water and surface water shall be: a. the extraction of ground water and/or surface wa. ter; b. the use of ground water and/or surface water; c. the extraction and use of ground water and/or sur face water. (2) Excepted from the objects of taxes on the extraction and use of ground water and surface water shall be: a. the extraction, use, or extraction and use of ground water and/or surface water by the Central Govern ment and the Regional Government; b. the extraction, use, or extraction and use of surface water by state-owned company and regional gov ernment-owned company specially established to exploit and manage water sources; c. the extraction, use, or extraction and use of ground water and/or surface water for smallholder irrigration; d. the extraction, use,. extraction and use of ground water and/or surface water for the basic needs of households and places of worship; e. the extraction, use, or extraction and use of ground water and/or surface water in the interests of the Fire Department; f. the extraction, use, extraction and use of ground wa ter and/or surface water for smallholder fish ponds. Article 4 ( 1) The subjects of the extraction and use of ground water and surface water shall be individuals and bodies that extract, use, or extract and use ground water and/or surface water. (2)The payers of taxes on the.extraction and use of ground water and surface water shall be individuals and bodies that extract, use, or extract and use ground water and/ or surface water rHAPTFR CHAPTER III TAX BASE, TARIFFS AND CALCULATION METHOD Article 5 ( 1) The tax base for the extraction and use of ground water and surface water shall be the acquisition value of water. (2) The acquisition value of water as meant in paragraph (1) shall be expressed in the rupiah counted according to some or all of the factors as follows: a. the type of water source; b. the location of water source; c. the aim of extracting and/or using water; d. the volume of water extracted, used, or extracted and used; e. the quality of water; f. the size of place for extracting and/or using water; g. the season of the extraction, use, or extraction and use of water; h. the level of environmental damage caused by the extraction, use, or extraction and use of water. (3)The acquisition value of water as meant in paragraph (1), as long as the water is used for the activitie~ of state owned companies and regional government-owned com panies serving public interests, and engaged in natural oil and gas mining businesses, shall be set by the Governor by observing the advice of the Minister. of Home Affairs. ( 4) The acquisition value of water as meant in paragraph (1) and paragraph (2) shall be set by means-of a guber natorial decision. (5)As part of environmental management efforts, the ac quisition value of water shall be set as follows: a. the acqusition value of water for the areas that have been reached by the Regional Drinking Water Com pany (PDAM) shall be higher than the tariff imposed by the Regional Drinking Water Company, b. where the extraction and use of ground water and surface water with a bigger multiple in the use of water is concerned, the basic price of water will be higher. Article 6 The tariff of taxes on the extraction and use of ground water and surface water shall be set as follows: a. ground water at 20% (twenty percent); b. surface water at 10% (ten percent). Business News 7065/28-5-2004 Article 7 The principal of taxes on the extraction and use of ground water and surface water which become due shall be counted by multiplying the tariff as meant in Article 6 and the tax base as meant in Article 5. CHAPTER IV TAX PERIOD AND MOMENT OF TAX DUE Article 8 ( 1) The tax period shall be a period of time that is equal to 1 (one) calender month or is the same as a period of time specified by a gubernatorial decision. (2) Part of a month shall be rounded up to 1 (one) month. Article 9 Taxes on the extraction and use of ground water and surface water shall become due at the moment of: a. extracting ground water and/or surface water; or b. using ground water and/or surface water; or c. extracting and using ground water and/or surface wa ter. CHAPTER V OTHER PROVISIONS Article 10 The formal provisions needed to collect taxes on the extraction of ground water and surface water shall fol low Regional Regulation of the Special Province of Jakarta No.4/2002 on General Provisions on Regional Taxes. CHPATER VI TRANSITIONAL PROVISIONS Article 11 ( 1) Taxes on the extraction and use of ground water and surface water which became due before the enforce ment of this Regional Regulation shall remain subject to Regional Regulation of the Special Capital Province of Jakarta No.10/1998 on taxes on the use of ground wa ter and surface water. (2)As long as the provisions needed to implement this Re gional Regulation have not be issued, the existing pro visions shall remain valid provided they do not contra dict this Regional Regulation. CHAPTER VII CONCLUSION Article 12 ..... Artide 12 Provisions needed to implement this Regional Regu lation shall be provided for in the gubernatorial decision. Article 13 When this Regional Regulation takes effect, Article 1 letters d, I, ac, ad, ae, af, ag, ah, ai, aj, ak, al, am, an and ap, Article 21, Article 22, Article 23, Article 24, Article 25, Article 26, Article 27, Article 28, Article 29, Article 30, Ar ticle 31, Article 32, Article 34, Article 35, Article 36, Article 37, Article 38, Article 39, Article 40, Article 41, Article 42, Article 43, Article 44, Article 45, Article 46, Article 47, Ar ticle 48, Article 49, Article 50, Article 51, Article 52, Article 53, Article 55, Article 56, and Article 57 of Regional Regu lation of the Special Capital Province of Jakarta No.10/1998 on taxes on the use of ground water and surface water shall be declared null and void. Article 14 This Regional Regulation shall take effect as from the date of stipulation. For public cognizance, this Regional Regulation shall be publicized by placing it in the Regional Gazette of the Special Capital Province of Jakarta. Stipulated in Jakarta on March 10, 2004 THE GOVERNOR OF THE SPECIAL CAPITAL CAPITAL PROVINCE OF JAKARTA, sgd. SUTIYOSO Promulgated in Jakarta on March 16, 2004 THE REGIONAL SECRETARY OF THE SPECIAL CAPITAL PROVINCE OF JAKARTA, sgd. H. RITOLA TASMAYA REGIONAL GAZETTE OF THE SPECIAL CAPITAL PROVINCE OF JAKARTA OF 2004 NO.25 ELUCIDATION OF REGIONAL REGULATION OF THE SPECIAL CAPITAL PROVINCE OF JAKARTA NO.1/2004 ON Business News 7065/28-5-2004 TAXES ON THE EXTRACTION AND USE OF GROUND WATER AND SURFACE WATER I. GENERAL This Regional Regulation is the other provisions on taxes on the use of ground water and surface water as speci fied in Regional Regulation of the Special Capital Province of Jakarta No.10/1998 on taxes on the use of ground water and surface water. The other provisions on the use of ground water and surface water specified in this Regional Regulation are aimed not only at raising regional revenues from taxes on the use of ground water and surface water but also at con trolling the environment to maintain the ecosystem and fi nance the running of government and the implementation of development program. In addition, they are also meant·to adjust to Law No.34/2000 on Amendment to Law No.18/ 1997 on Regional Taxes and Levies, and Government Regula tion No.65/2001 on Regional Taxes. Given the Regional Regulation of the Special Capital Province of Jakarta on General Provisions on Regional Taxes (KUPD) applicable to all types of regional taxes, the formal provisions containing procedures for collecting taxes on the use of ground water and surface water according to this Regional Regulation follow provisions specified in the Re gional Regulation on General Provisions on Regional Taxes, except where this Regional Regulation otherwise stipulates. Hence, this Regional Regulation contains material provisions covering tax objects and subjects, tax tariffs, tax base and tax calculation method, as well as tax period and moment of tax due. II. ARTICLE BY ARTICLE Article 1 and 2 Sufficiently clear Article 3 Paragraph (1) letter a The extraction of ground water and/or surface wa ter referred to herein includes the extraction of water in the oil and gas mining sector. letter b The use of ground water and/or surface water re ferred to herein includes the use of water for generators. letter c Sufficiently clear Paragraph ..... Paragraph (2) letter a Excluded from those excepted as the objects of taxes on the extraction and use of ground water and surface water is the extraction, use, or extraction and use of ground water and/or surface water by state-owned companies and regional government-owned companies. letter b Sufficiently clear letter c The exception of the objects of taxes on the extrac tion or use of ground water and/or surface water for smallholder irrigation must always consider the conserva tion of the environment. letter d The exception of the objects of taxes on the extrac tion or use of ground water and/or surface water for the basic needs of households is meant to see if the water is really used for the basic needs of households and places of worship; excluding rented houses. Only the rented houses which use more than 50 m3 of water per month are subject to taxes on ground water and surface water. letter e Sufficiently clear letter f Referred to as the exception to the extraction, use, or extraction and use of ground water and surface water for smallholder fish ponds is the exception of the objects of taxes on the extraction or use of ground water and/or surface water for smallholder fish ponds, excluding large-scale fish ponds run by bodies. Article 4 Sufficiently clear Article 5 Paragraph (1) Sufficiently clear Paragraph (2) letter a Sufficiently clear letter b The definition of the location of water source in cludes the depth of water source aquifer tapped. letter c Sufficiently clear Business News 7065/28-5-2004 letter d Referred to as the volume of water extracted is the volume of water counted in 1 (one) month concerned based on the water machine, discharge measuring instrument or other measuring instruments. letter e and letter f Sufficiently clear letter g Referred to as the season of the extraction, use, or extraction and use of water is the dry season or the rainy season. letter h Sufficiently clear Paragraph (3) up to Paragraph (5) Sufficiently clear Article 6 Sufficiently clear Article 7 Paragraph (1) Following is the example of how to count tax princi pal. Taxpayer XX is known to have used 2,400 m3 of ground water. Based on the figure taxpayer XX belongs to the group of large-scale business, namely one, two, or three star-rated hotel reached by the Regional Drinking Water Com pany (PDAM). The amount of taxes on the extraction and use of ground water and surface water can be calculated as . follows: Tax on ground water = f x NPA == f x (NPA = (Q(m3) x fn water x HDA)) == 20% X (NPA = (2,400 X 6 X Rp2,750)) == 20% X Rp39,600,000 == 7,920,000 Tax on surface water = f x NPA ::: f x (NPA = (Q(m3) x fn water x HDA)) == 10% X (NPA == (900 x 6 x Rp2,500)) == 10% x Rp13,500,000 == Rpl,350,000 Article 8 up to Article 14 Sufficiently clear. ===( s )===