Based on the benchmark price of fuel MOPS It Right

The use of MOPS (Mean of Plats Singapore) by the Indonesian government to determine the price of benchmark price of Fuel Oil (BBM) in the country is right, this is not based on the conditions of the market price in the country so that the necessary reference price of the nearest market (border price). 

However disclosed Head of Law and Legislation Directorate General of Oil and Gas, Susyanto respond to the notification, which questioned why the government chose as the basic price of MOPS benchmark price of fuel in the country. He also said that the use of the MOPS price is relatively in line with the price index published other institutions (the International Energy Administration) and several other countries. 

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Businesses criticize cooking oil VAT cut

Businesses gave a cold response to a government plan to waive value-added tax (VAT) on up to 50,000 liters of unbranded packaged cooking oil each year, dismissing the amount as "too small" for the subsidy. 

The amount eligible for the subsidy was peanuts compared to the 80 million liters of unbranded cooking oil used each month by households and industry, Indonesian Vegetable Oil Producers Association (Gimni) executive director Sahat Sinaga said on Friday. 

"Ideally, the government should waive the VAT on 50,000 tons of unbranded cooking oil per month if it really wants to reduce burdens on the community," Sahat said. 

The government plans to waive VAT on several categories of goods including unbranded packaged cooking oil, to help keep prices in check, Trade Minister Mari Elka Pangestu said recently. 

At present, unbranded cooking oils sell for between Rp 9,000 (75 US cents) and Rp 10,000 per kilogram. 

"*Packaged* unbranded cooking oils eligible for the VAT cut are sold at traditional markets for prices within consumers' reach," Mari told members of House Commission VI (which oversees industry, trade, state-owned enterprises, cooperatives and small and medium enterprises). 

The government plans to phase out sales of unpackaged cooking oils, which it hopes to replace with packaged unbranded cooking oils, Trade Ministry domestic trade director general Subagyo said recently. 

"In future, we hope, unbranded packaged cooking oils will be slightly more expensive than unbranded unpackaged cooking oils, but cheaper than branded cooking oils," Subagyo said. 

The unbranded packaged cooking oils the government plans to promote would be labeled Minyak Goreng Sawit or MGS (palm oil for cooking), Subagyo added. 

In a bid to stabilize cooking oil prices, Sahat said, state logistics firm Bulog was working with businesses to market unbranded packaged cooking oils. 

MGS cooking oil would be sold in 500-milliliter, 1-liter, 5-liter and 18-liter packages, said Indonesian Cooking Oil Industry Association chairman Adiwisoko Kasman (also involved in the marketing venture). 

"We are now processing licenses with BPOM *Food and Drug Food Monitoring Agency* and MUI *Indonesian Ulema Council*, prior to the launch scheduled for January 2009," Adiwisoko said.

source: Mustaqim Adamrah, , The Jakarta Post, , Jakarta | Sat, 12/06/2008 11:40 AM | Business