Indonesian government cuts import duty on rice to rp450 per kilogram

Jakarta (ANTARA News) - The government has decided to cut the import duty on rice to 450 rupiah per kilogram from 550 rupiah previously as part of a plan to stabilize the price of staple food, Coordinating Minister for the Economy Budiono said Friday.

"The import duty cut on rice is part of the government's program, launched today, to stabilize the prices of basic commodities that are affecting the common people's daily life," Budiono was quoted by Thomson Financial as telling reporters at the State Palace.

The government has also launched various programs to stabilize the prices of other basic commodities such as cooking oil, soybean, kerosene and wheat, said Budiono.

As part of efforts to stabilize the price of rice, the government will boost rice production this year through the distribution of quality seeds to farmers, he said.

The government will also increase the quantity of subsidized rice provided to the poor from 10 kilograms per month to 15 kilograms, he said.

The government will raise the export tax for crude palm oil to 15 percent if the price of the commodity rises to 1,100 US dollars per ton or higher in an effort to reduce the price of domestic cooking oil, Budiono said.

According to current tax regulations, CPO exporters are charged the maximum tax rate of 10 percent.

He said the government will also sell subsidized cooking oil to the poor and small-sized business operators at an average of 2,500 rupiah per kilogram.

As for soybean, the government has decided to remove the 10 percent import tax of the commodity, he said.

Record soybean prices have threatened the existence of small and medium-sized enterprises, which use soybean as a raw material for the production of soybean curd and fermented soybean cake, a staple Indonesian diet espso sell subsidized soybean to small business operators for six month.

The government will also scrap the 5 percent import tax on wheat, said Budiono.

Wheat is traditionally processed into flour, which is used to make noodles.