For those who are interested and did not get to watch the debate on fuel price hike between Arianto Patunru, Dradjat Wibowo, Budiman Sudjatmiko and sayaSilahkan see here
Here is the text of the 2005 Teguh Dartanto of fuel, subsidies, and poverty. This paper seems still relevant in the recent fuel debate. Firm is LPEM-FEUI researchers currently studying at Hitotsubashi University. This paper was published in Innovation Online, Japan PPI communications media. Fuel, Energy Policy, Subsidies, and Poverty in DartantoKenaikan Teguh IndonesiaOleh oil prices which reached 60. 63 U.S. $ / barrel provides its own problems for the countries importing oil. The increase in oil prices will directly increase the production costs of goods and services and community life and the burden would ultimately weaken the world economy. There are four main factors that affect the oil price increases sharply. First, the United States invasion of Iraq: the invasion led to the oil fields in Iraq can not produce an optimal so that the oil supply has decreased. Second, oil demand is great enough from India and China. Third, hurricanes Katrina and Rita that hit the United States and destructive activities of oil production in the Gulf of Mexico. Fourth, the inability of OPEC to stabilize world oil prices. . . . . The increase in oil prices to its own disaster for the Indonesian government. In fact Indonesia is currently recognized as one of the world’s oil producers today is one of the oil importing countries. The increase will increase the burden of fuel subsidies postal budget and will ultimately increase the state budget deficit of about 0. 7% of Gross Domestic Product (GDP) to 1. 3% of GDP. Government’s efforts to cover the budget deficit is to raise fuel in March 2005 by 29% and followed by an unnatural increase in October 2005 month for more than 100%. Increase in Fuel price (BBM) always led to the pro and cons among the people and a lot of opinions emerged without being followed by the data accurately, so confusing the public. Further read here
Here are comments Ari A. Prime the circulation of an electronic letter of subsidies and fuel, which among other uses Kwik Kian Gie’s argument that “[a] subsidy is a lie”. Ari wrote this on his personal blog, Gallery of Mind. We fit back in here. Why Kwik Wrong? By Ari A. PerdanaMenjelang announced fuel price hike, a long article written by Kwik Kian Gie back into the discourse. The article is titled “Raising the price of Premium Gasoline,” published in Kompas nearly two years ago (1/8/06). Points from the article: the fuel subsidy has never really been there (the link is closed by Kompas). Kwik basis argument is a calculation of accounting. Costs required to produce one liter of premium gasoline, ranging from drilling, refining to transportation to the gas station is 10 U.S. dollar per barrel (159 liters). Rp8 exchange rate. 600 per U.S. dollar, two years ago Huey said that the production cost per liter of premium equal to Rp540. Huey added, there is no subsidy for the premium price of Rp1. 810 per liter, in fact for every liter of premium which the government sold a surplus. According to Huey, “the government was giving subsidies to people who buy premium gasoline because if premium gasoline is sold outside the country, [then] it costs 50 U.S. dollars per barrel … the Government was giving a subsidy because they can not sell gasoline at a price the world, because of because there is an obligation to meet the needs of people with the price of premium gasoline is low … The government annoyed, feeling really bad luck can not sell gas abroad … that’s a lost opportunity [to be subsidies], rather than cash. “With the basic logic and a similar calculation, an article today berdar electronic mail through the media and blogs to adjust the calculation to the latest figures. Same conclusion, the subsidy is a lie. According to the article, “If the international oil price of 125 U.S. dollar / barrel and the cost of 15 U.S. dollar / barrel and imported 200 thousand barrels / day the Indonesian government Rp4 price. 500/liter (77 U.S. dollar / barrel) 49.4 million profit U.S. dollar per day or Rp165, 8 trillion a year (1 U.S. dollar = USD 9. 200). “The truth and who keliruKwik (and Agusnizami) true, the domestic selling price accounting is still greater than the cost of production. This means, for each liter of premium the government still had a surplus. Huey was right, the so-called subsidy is the difference between international prices (the price the seller will accept oil, in this case the government) with the domestic price. Until Huey right here, ‘subsidies’ did happen because of the ‘lost opportunity’ (opportunity cost) – the government loses potential revenue by selling gasoline at a price below the international price. But Huey wrong when he says’ there is no subsidy. ‘Kwik wrong when he saw that the problem is simply “annoyed the government was right” (because they can not make money is greater than the international price of having to serve the people). Kwik forget that the lost income is money that can be used to fund school construction, rural roads, bridges, irrigation, health center etc.. By saying that the fuel was “owned by the government that could be obtained for free” he was like saying “the potential income from selling Rp120 trillion in international prices is not owned by the government.” Forgotten, or pretended to forget? It is here occurred subsidies — from consumer to consumer fuel other public goods. Who is the consumer (viewer subsidies) fuel? According Sakernas 2006, nearly 3 / 4 fuel subsidies enjoyed by the richest 30% of the population. Only less than 5% enjoyed by the poorest 20% of the population. I do not believe Huey did not understand the concept of opportunity cost. More likely is that he pretended not to understand. Huey’s right, there have been duping. Unfortunately, he also contributed to this deception. Note: Arya Gaduh’ve never discussed this when it first came out Huey articles. Dartanto firm provides a deeper analysis of the following calculations of oil production and consumption of Indonesia.
Share it with SyahrialSeperti Syarief DaerahOleh we know, there are related to fuel taxes at the provincial areas of Tax Motor Vehicle Fuel (UN-KB) 5% tariff. It’s name is local taxes but, in essence, the mechanism is for the results. Why? If he taxes the province, then picked up the provincial government should be cq. SKPD authorities in managing the regional income. The reception is 5% multiplied by the value of the tax sale or object in this case the sale price multiplied by the volume of fuel. Currently, the United Nations family planning acceptance scale for each province was obtained from the data that determine the amount Pertamina fuel consumption of each province. Therefore, these taxes are “no effort” from the provincial government as well as general street lighting tax at the district level is determined by PLN. By implication, the truth of the UN family planning acceptance for each province Pertamina only knows. We also can check the truth of fuel consumption data as the basis for the assumption of the determination of the amount of subsidy fuel consumption data are the basis for dividing Tax Motor Vehicle Fuel. It was this idea only for the type of fuel used in motor vehicles when the fuel subsidy is also associated with kerosene subsidy so that the amount of subsidy reduction targets can not be achieved 100% compared with the use of the way taken by the current government of SBY. My idea is to change the type of UN family planning from the provincial tax to the tax center. In accordance with the theory, the tax object is “mobile” tax administration should be higher. Definition of “mobile” and this is a question. At first, I thought to continue to make the United Nations family planning is a provincial tax by raising the tariff from 5% to 30%. By implication, if the government does not want fuel price rises in the area, he could use this instrument to remove the fuel subsidy from the state budget to local budget burden. Tokh, we know too many local government budget surplus at the central government runs a deficit budgeting system. However, this mechanism will make us not avoid the potential problem of arbitration. From this condition, the UN family planning should be the central tax is in practice a mechanism for the results. As compensation, the United Nations (Land and Building Tax) into the local tax is the tax object is “Immobile” and has been behaving like a real Taxes de jure when he over-sharing mechanism. Does this reduce the income in the state budget? Yes. However, tokh, during dibagihasilkan UN 100% 90% for local (including collection fees) 10% for the center. 65% from 10% property restored to the central principle of equal and another 35% divided into areas for local incentives for the “over-target”. So do not be left over, right? Now, are still being discussed changing the Act 34/2000 on Regional Tax and Retribution. Maybe this is also an opportunity for changing the center of this tax type. There are many parties who feared that such a mechanism, the fiscal disparities between regions increased. Differentiate land prices in Jakarta with the price of land in Bangka Belitung. Far right? However, if the mechanism of the UN-KB is also true, it would appear that greater disparities between DKI Jakarta and Babylon in the amount and quality of different vehicles. How the mechanism of central taxes to fuel this vehicle? In my opinion, this is done with the technique of “superimposed” on the Samsat office (now called the Regional Technical Service Unit Provincial Revenue) when making a payment of motor vehicle Motor Vehicle Tax (PKB). This is also followed by scientific research on average how many miles a vehicle in one year he had passed. Very easy to do we know what the compression ratio needs fuel (liters) for his one kilometer. In this way we will know the approximate fuel needs within a year. What if his past assumptions miles imposition? We can also impose a tax on miles as he passed by the Danish. What if you could reset the speedometer tera? This course also fined the maximum. Technique “superimposed” what cheating is also done on the UN so far. Where the United Nations, the Central tax, levied by the City Revenue District. Later, Revenue gained 10% of Customs Collection. In contrast to the very high UN effort, the United Nations family planning is relatively very easy to do because it coincided with the payment of Motor Vehicle Tax. So, for example, were given 5% of Customs Collection, for apparatus Samsat and traffic cop, is a very big contribution to them. My friend is afraid of the police bring money for food illegitimate son’s wife, so eager to “raid” motor vehicles that do not pay taxes. In fact, in Indonesia today also there is also Motor Vehicle Tax on water and Customs Behind the Name of Motor Vehicles on Water. Thus, the same mechanism can be applied to owners of fishing vessels. But, its implementation is very difficult. “Less fierce” than the legal apparatus of fishermen. There’s only weakness of this idea, namely the difficulty we guarantee arbitration mechanism by stations either directly by selling fuel to the industry as well as abroad. That obviously requires further thought. *** Researcher LPEM-FEUI