The Challenges of Carbon Tax Adoption in Indonesia: The Legal System Perspective

Universitas Islam Indonesia

Lihat

The Government of Indonesia is facing two conflicting policies: energy security policy and emissions reduction policy. When the decarbonization program has not been effective, the Government of Indonesia develops the additional 27.1 GigaWatts of New Coal Power Plants in 2028. In this situation, the Government of Indonesia will be unable to meet the Nationally Determined Contribution of Emission Reduction and net-zero emissions. The carbon tax is expected to be an option to overcome the policy conflict. This article addresses the two research questions: First, how the comparative issues regarding the carbon tax adoption. Second, how the legal system perspective sees the possibility of carbon tax adoption in Indonesia with its challenges. This article is a summary of normative legal research by using conceptual and comparative approaches. The results show that the concept of environmental tax in Indonesia – the carbon tax as part of it – is different from the Pigouvian Theory universally used. Currently, the Ministry of Finance and the Ministry of Environment have no coordination to determine tax power, tax base, sector, tariff, and taxpayers of Carbon Tax. Political and economic interests might prevent the adoption of the carbon tax as green tax reform in Indonesia.
Keywords: Carbon Tax, GHG Emissions, Legal System

Daftar Pustaka

Book

Arinaldo, Deon et.al, Indonesia’s Coal Dynamics: Toward a Just Energy Transition, Institute for
Essential Services Reform, Jakarta Selatan, 2019.
Barde, Jean-Phillipe, Environmental Taxation: Experience in OECD Countries. Timothy
O’Riordan (eds), Ecotaxation, Earthscan Publication Limited, UK, 1997.
Bridle, Richard, et.al, Missing the 23 Per Cent Target: Roadblocks to the development of renewable
energy in Indonesia, International Institute for Sustainable Development, Manitoba
Canada, 2018.
Butarbutar, Paul and Manuel Cocco, Carbon Pricing in Indonesia:
A Policy Note and a Case Study For the Cement Sector, Australia Indonesia Partnership
for Economic Governance (AIPEG) and Centre for Climate Change Financing and
Multilateral Policy (CCCFMP) of the Fiscal Policy Office (FPO) at the Ministry of
Finance (MOF) of the Government of Indonesia (GOI), 2012.
Climate Transparency, Brown to Green: The G20 transition towards a net-zero emissions
economy, Climate Transparency, Berlin, Germany, 2019.
Friedman, Lawrence M., The Concept of Legal Culture: A Reply, In David Nelken (Ed).
Comparing Legal Cultures, Dartmouth Publishing, 1997.
Friedman, Lawrence M., The Legal System a Social Sentence Perspective, Rusell Sage
Foundation, New York, 1975.
Hindarto, Dicky Edwin, et.al, Pengantar Pasar Karbon untuk Pengendalian Perubahan Iklim,
PMR, UNDP, Jakarta.
IIES & IIEE, Kebutuhan Investasi Energi di Indonesia – Studi Kasus: Rencana Umum Energi Nasional, Jakarta Institute for Essential Service Reform (IESR) & Indonesian Institute
for Energy Economics (IIEE), 2019.
Mercalf, Gilberte E., Paying for Pollution Why a Carbon Tax is Good for America, Oxford
University Press, 2019.
World Bank Group, State and Trends of Carbon Pricing 2019, Washington DC, 2019.
Journal/ Report
Acar, Ali, “The Concept Of Legal Culture With Particular Attention
to The Turkish Case”, Ankara Law Review, Vol.3 No.2, 2006.
Das, Samantak, Dripto Mukhopadhyay, Sanjib P, “Role of Economic Instruments in
Mitigating Carbon Emissions: An Indian Perspective”, Economic and Political Weekly,
June 16th, 2007.
Direktorat Jenderal Pengendalian Perubahan Iklim, “Statistik tahun 2018”, Kementerian
Lingkungan Hidup dan Kehutanan, Jakarta, 2019.
Faure, Michael, Morag Goodwin, Franziska Weber, “Bucking The Kuznets Curve:
Designing Effective Environmental Regulation in Developing Countries”, Virginia
Journal of International Law, vol. 51, no. 1, 2010.
Fiscal Policy Agency Ministry of Treasury of Republic of Indonesia, “Funding of
Indonesia’s Climate Change Adaptation and Mitigation”, Report, 28 of March 2018.
Friedman, Lawrence M., “Is There A Modern Legal Culture,” Ratio Juris, Vol. 7, No. 2 July
1994.
Hasan, Dahliana, “Environmental Taxes On Industries In Indonesia: Developing A
Framework For Sustainability ”, Dissertation, Doctor Of Philosophy Of The
Macquarie University.
Höhne, N., Fransen, T., Hans, F., Bhardwaj, A., Blanco, G., den Elzen, M., Hagemann, M.,
Henderson, C., Keesler, D., Kejun J., Kuriyama, A., Sha, F., Song, R., Tamura, K.,
Wills, W. “Bridging the Gap: Enhancing Mitigation Ambition and Action at G20
Level and Globally.” An Advance Chapter of The Emissions Gap Report 2019. United
Nations Environment Programme. Nairobi. 2019.
IPCC, “Global Warming of 1.5°C. An IPCC Special Report on the impacts of global
warming of 1.5°C above pre-industrial levels and related global greenhouse gas
emission pathways, in the context of strengthening the global response to the threat
of climate change, sustainable development, and efforts to eradicate poverty”
[Masson-Delmotte, V., P. Zhai, H.-O. Pörtner, D. Roberts, J. Skea, P.R. Shukla, A.
Pirani, W. Moufouma-Okia, C. Péan, R. Pidcock, S. Connors, J.B.R. Matthews, Y.
Chen, X. Zhou, M.I. Gomis, E. Lonnoy, T. Maycock, M. Tignor, and T. Waterfield
(eds.)]. In Press. 2018.
Metcalf, Gilbert E., “Implementing a Carbon Tax”, Resources For Future Report, 2017.
Pearce, David, “The Role of Carbon Taxes in Adjusting to Global Warming”, 101 The
Economic Journal, 1991.
Sampara, Said, et.al, “Harmonization of Environmental Laws Based On Democracy Justice
Principle and Sustainability”, IOSR Journal Of Humanities And Social Science (IOSRJHSS),
Volume 23, Issue 8, Ver. 3 (August. 2018).
Suarna, Endang, “Perkembangan Teknologi Batubara Bersih Berwawasan Lingkungan”,
Jurnal Teknik Lingkungan, Vol. 12, No. 1. 2011.
Sumner, Jenny, Lori Bird, and Hillary Smith, Carbon Tax: Review of Experience and Policy
Design Consideration, Technical Report, National Renewable Energy Laboratory,
2009.
Weisbach, David A. & Gilbert E. Metcalf, “The Design of a Carbon Tax,” 33 Harvard
Environmental Law Review 499, 2009.
Wijaya, A., H. Chrysolite, M. Ge, C. Wibowo, A. Pradana, A. Utami, and K. Austin, “How
Can Indonesia Achieve its Climate Change Mitigation Goal? An Analysis of Potential
Emissions Reductions from Energy and Land-Use Policies.” Working Paper. Jakarta,
Indonesia: World Resources Institute, 2017.

Others

Ana Mariana Lebada. (2019, May 16). ECOSOC Special Meeting Highlights Tax Challenges
in Digitalization, Climate [Online]. Available: https://sdg.iisd.org/news/ecosocspecial-
meeting-highlights-tax-challenges-in-digitalization-climate/
CNN Indonesia, 2017, 31 July, Dinkes DKI Sebut Trend Penderita ISPA Meningkat 2016-
2019 https://www.cnnindonesia.com/nasional/20190730181324-20-
416867/dinkes-dki-sebut-tren-penderita-ispa-meningkat-2016-2018
https://stats.oecd.org/glossary/detail.asp?ID=287
https://www.cnnindonesia.com/nasional/20190716161616-20-412627/walhi-10-pltubatu-
bara-sumbang-30-persen-polusi-jakarta