Based on Regulation of the Minister of Energy and Mineral Resources (EMR) Number 42 Year 2018 regarding Oil Utilization Priority for the Fulfillment of Domestic Need, production sharing contract contractors (PSCC) are obligated to sell their oil to Pertamina which will buy it at the market price. Unfortunately, the implementation of such obligation encounters an obstacle because of a concern about the high tax to be imposed on the sales.
PSCC who sell their oil to Pertamina will be subject to a tax of 44%. Meanwhile, they will be imposed to a lower tax if they sell their oil overseas.
According to the Deputy Minister of EMR, Arcandra Tahar, the Ministry of Finance will revise the regulation related to the sales of oil by PSCC to Pertamina. Thereby, the tax will only be imposed on profits of the sales of oil.