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Indonesia Will Implement Carbon Tax in Two Phases

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According to Indonesia’s Coordinating Ministry for Economic Affairs, the country will implement the carbon tax in two phases in accordance with the road map that the government is preparing.

“The initial phase of the carbon tax road map is proposed to only regulate the implementation of the carbon tax in the power plant subsector,” the ministry’s Deputy III for the Development of State-Owned Enterprises, Research, and Innovation, Elen Setiadi, notes.

For the second phase, the carbon tax will also be imposed on transportation that uses fossil fuels.

The carbon tax on these two sectors is expected to cover around 71% of emissions in the energy sector.

According to Setiadi, implementing the green economy in the long term can maintain Indonesia’s economic growth at an average of 6.2% until 2045.

In addition, the transition to a green economy is also deemed able to reduce emissions by 86 million tons of CO2 equivalent and create 4.4 million new jobs.

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