Ministry May Raise Import Duty for PPE

TEMPO.CO, Jakarta - The Indonesian government has imposed duties for the imports of surgical masks, medical protective clothing, gloves, and surgical wear following the issuance of the Finance Minister's Regulation (PMK) No.149/PMK.04/2020. A ministry official said the tariff could be raised, in an effort to reduce imported supplies.  

The Industry Ministry's director of the textile, leather and footwear industry, Elis Masitoh, said that the market for surgical masks in the country was disrupted due to an increase in imports of very cheap goods, up to Rp20,000 per box of 50 pieces, around half the price of domestic products. This has led to a reduction in the average production utilization rate to 20-30 percent of capacity.

"Due to the oversupply, the state is only giving ease of import for N95 masks. PPE and medical masks have not been given exemption from import duty since October," Elis told Tempo on Wednesday, December 9.

According to Elis, it is necessary to control the import of surgical masks through tariff barriers by raising the import duty.

"We can implement tariff barriers, such as by raising import duties either in the form of ad valorem taxes or specific rates. Non-tariff barriers can be imposed in the form of technical specifications. This is still being proposed," he said.

Meanwhile, the chairman of the Indonesian Textile Experts Association (IKATSI) Suharno Rusdi said that imported PPE products are cheaper because the prices of raw materials in exporting countries are lower than those produced domestically, as an impact of declining oil and gas prices worldwide.

The government has issued PMK 134/2020, which exempts import duty for PPE raw materials, but it is not enough compared to the global downtrend of PPE raw material prices.

"The government must increase the import tax on PPE products before our PPE producers die," said Suharno.

Read: ICW Questions Govt Realization of Surgical Masks, PPE

Larissa Huda