Applying Tax Rate of 33,33% on Primary Energy in Indonesia

Tri Purwaningsih, Vitriyani and Widodo, Tri (2019): Applying Tax Rate of 33,33% on Primary Energy in Indonesia.

Abstract

High fuel consumption has a negative impact not only on the environment, but also can have wider impact on the country's economic conditions. Thus, steps need to be taken regarding the use of fuel in order to reduce the negative impact that results. The aims of this study is to analyze the impact that occurred on the industry and the Indonesian economy when a tax of 33,33% was determined on the use of primary energy, that is coal and petroleum products, through three simulations. By using a model from GTAP-E, the region is aggregated into 7 regions and the industrial sector will be aggregated into 11 industries. The result shows that simulation C has a significant impact on the industry and the Indonesian economy. In addition, this simulation is also able to reduce carbon dioxide gas emissions which derive from coal and petroleum.

• Item Type: MPRA Paper
• Language: English
• Keywords: Tax, Petroleum, Coal, GTAP-E
• Subjects: Q - Agricultural and Natural Resource Economics ; Environmental and Ecological Economics > Q4 - Energy > Q43 - Energy and the Macroeconomy; Q - Agricultural and Natural Resource Economics ; Environmental and Ecological Economics > Q4 - Energy > Q48 - Government Policy

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