Minister Basuki: 39 Toll Roads Can Extend the Concession Period

INDUSTRY.co.id - Madiun - Minister of Public Works and Public Housing (PUPR), Basuki Hadimuljono, said there are 39 toll roads that get extension of the concession period as part of tariff reduction policy.

Minister Basuki said, the extension of the concession period is given up to 50 years, from the average concession toll road is currently around 30 to 40 years.

"There are 39 toll roads we evaluate at a price above Rp 1,000 per kilometer, which is above the Rp1,000 price that we will try to compensate by adding concessions," Basuki said after reviewing the Wilangan-Kertosono Toll Road in East Java, Thursday (29/3/2018)

He explained that 39 toll roads granted extension of the concession period are toll roads constructed over 2015 with rates ranging from Rp900 to Rp1,500 per kilometer.

Given the extension of the concession period, the toll tariff will be harmonized to Rp 1,000 per kilometer as the base rate for group I.

The minister added that of the 39 toll road segments, 36 sections are only granted concession period, while the other 3 toll road sections, namely Solo-Ngawi, Ngawi-Kertosono and Kertosono-Mojokerto segments, receive extension of concessions and tax incentives.

According to him, tax incentives, which will be regulated by the Ministry of Finance, will be the other instruments provided by the government to safeguard the feasibility of IRR, maintain investor confidence and legal certainty, and not reduce the contract between the government and Toll Road Enterprises (BUJT) .

"If the extension of the concession is aimed to keep the IRR from disturbing and as long as the extension of the concession can still close the investment, it's okay." Incidentally, there are three segments that have not been able to cover despite the extension of the concession, so there is a tax incentive, "said Basuki.

Tax incentives, such as subsidies and "tax holiday" and other financial instruments that do not affect investment and IRR feasibility.

In the tariff harmonization scheme of this toll road, Basuki will also simplify the class of freight vehicles with cluster formation. Group II vehicles (trucks with two axles) and III (three axle trucks) will be combined into one cluster as Group II, while Group IV (four-axle truck) and V (five-axle truck) are combined into Group III.

There is also a scheme of tariff reduction is a follow-up to the direction of President Joko Widodo who wants toll fares cheaper so as to reduce logistics costs. (ant)