DECREE OF THE MINISTER OF FINANCE
No.98/KMK.05/2000

ON
RELIEF OF IMPORT DUTY ON RAW MATERIALS/SUB-COMPONENTS/AUXILIARY MATERIALS FOR MANUFACTURING ELECTRONIC COMPONENTS

THE MINISTER OF FINANCE,

Considering :

• a. that in order to enhance the competitiveness of electronic component industries and their supporting industries in the country, it is necessary to grant relief of import duty on raw materials/sub-components/auxiliary materials for manufacturing electronic components;
• b. that in the framework of enhancing the effectivity of granting of import duty facilities by continuously observing interests of state revenue, it is deemed necessary to replace the Decree of the Minister of Finance No.659/KMK.01/1997 with a decree of the Minister of Finance.

In view of :

• 1. Law No.10/1995 on customs affairs (Statute Book of 1995 No.75, Supplement to Statute Book No.3612);
• 2. Presidential Regulation No.355/M/1999;
• 3. Decree of the Minister of Finance No.440/KMK.05/1996 on the stipulation of classification systems of goods and tariffs of import duty on imported goods as already amended and supplemented the latest by the Decree of the Minister of Finance No.569/KMK.01/1999.

DECIDES :

To stipulate :

THE DECREE OF THE MINISTER OF FINANCE CONCERNING RELIEF OF IMPORT DUTY ON RAW MATERIALS/SUBCOMPONENTS/AUXILIARY MATERIALS FOR MANUFACTURING ELECTRONIC COMPONENTS

Article 1

Relief of import duty shall be granted to raw materials/sub-components/auxiliary materials imported by electronic component producers for manufacturing electronic components which are stipulated by the Minister of Industry and Trade, with the provision that :

• 1. raw materials/sub-components/auxiliary materials for manufacturing electronic components are granted import duty relief so that the final tariffs of import duty become 5% (five percent);
• 2. In the case of tariffs of import duty which are contained in the Indonesian Import Duty Tariff Book (BTBMI) being 5% (five percent) or below, the effective tariffs are tariffs in BTBMI.

Article 2

Kinds, specifications and quantities of raw materials/sub-components/auxiliary materials securing facilities of relief of import duty shall be based on lists of raw materials/sub-components/auxiliary materials for the need of annual production goods stipulated by the Minister of Industry and Trade.

Article 3

Applications for securing relief of import duty as meant in Article 1 shall be accompanied by the following documents :

• 1. Taxpayer Code Numbers (NPWP);
• 2. Business licences from ministries/institutions concerned;
• 3. results of verification of the need for raw materials/sub-components/auxiliary materials for one production year from the Ministry of Industry and Trade;
• 4. lists of quantities, kinds, specifications and prices of goods.

Article 4

(1) The applications for securing the facilities as meant in Article 1 shall be submitted by producers to the Director General of Customs and Excise.

(2) In the case of the applications as meant in paragraph (1) fulfilling the requirements, the Director General of Customs and Excise or official appointed, on behalf of the Minister of Finance shall make decisions on relief of import duty, along with lists of goods enjoying import duty relief as well as appointment of loading seaports.

(3) Electronic component industries securing relief of import duty shall be obliged :

• a. to keep books of the imported raw materials/sub-components/auxiliary materials for the need of customs audits;
• b. to store and maintain documents, records and books connected with the granting of facilities of relief of import duty in their business places for at least 10 (ten) years as from the date of realisation of the import;
• c. to convey reports on the realisation of the import.

Article 5

The goods granted import duty relief as meant in Article 3 paragraph (2) shall be subjected to the collection of import duty and other import levies, in the case of the goods failing to meet the provisions on quantities, kinds and specifications of goods which are contained in lists of goods upon the import.

Article 6

(1) Goods already securing facilities of relief of import duty can only be used to meet the need of the relevant industries.

(2) Any misuse of the goods as meant in paragraph (1) shall nullify the facilities of import duty given to the goods, so that the import duty owed must be paid and the relevant industries are subjected to fine of 100% (one hundred percent) of the shortage of import duty.

Article 7

(1) In order to safeguard state financial rights and to assure the fulfillment of customs and excise provisions in force, the Directorate General of Customs and Excise shall audit books, records and documents of industries and waste treatment companies connected with the import, use, release and stocks of goods.

(2) Based on results of the audit as meant in paragraph (1), industries and waste treatment companies shall be responsible for the settlement of import duty and excise owed as well as administration sanction in the form of fine.

Article 8

Companies securing facilities of relief of import duty on raw materials/sub-components/auxiliary materials for manufacturing electronic components which are on the basis of the previous provisions and do not yet realize the import wholly, can continue to use decisions on the granting of customs facilities on the basis of the previous provisions up to the expiration of the validity period of the decisions, with the provision that the facilities can not be extended and/or amended.

Article 9

Upon the enforcement of this decree, the Decree of the Minister of Finance No.659/KMK.01/1997 shall be declared null and void.

Article 10

The Director General of Customs and Excise shall further stipulate provisions needed for the implementation of this decree.

Article 11

This decree shall come into force as from April 1, 2000.

For public cognizance, this decree shall be published by placing it in State Gazette of the Republic of Indonesia.

Stipulated in Jakarta
On March 31, 2000

THE MINISTER OF FINANCE
sgd
BAMBANG SUDIBYO