Hoax 4 : Oil palm plantations do not contribute to the revenues of oil palm plantation areas
share the truth
Do oil palm plantations not contribute to the revenues of oil palm plantation areas ?
Oil palm plantations developed in 190 regencies and 23 provinces in Indonesia economically drive the growth and development of those areas. The oil palm plantation centers enjoy the expansion of employment and business opportunities, increased production of goods and services and increased economic growth.
Oil palm plantations are taxpayers. They pay taxes including land and building tax, value added tax, individual or corporate income tax, international trade tax (export tax, export duties and import duties) and dividends for any activities related to oil palm plantations.
Those taxes are the revenues of the central government and local administrations (especially the land and building tax). Through the state budget or regional budget mechanism, the government revenues are distributed to finance the activities of the ministries or agencies of the central government and activities of the local administrations through fiscal decentralization instruments such as the general allocation fund (DAU) and the special allocation fund (DAK).
In other words, the contribution of oil palm plantations to the local revenues has occurred so far through the fiscal mechanism of the state budget as well as through the provincial budgets, regency budgets and municipality budgets. The more developed and enhanced the production of palm oil in the aforementioned areas is, the greater the contribution to local revenues either through central taxes or local taxes.
The above description shows that people enjoy the fruits of oil palm plantations through the state budget and/or regional budget mechanisms. In addition, the community also receives plantation corporations’ CSR funds through various productive activities such as education scholarships, capital assistance, training and local cultural development.