The Imposition of Safeguard Import Duties on Imports of Carpets and Other Textile Floor Coverings Products

Ganda Christian Tobing
Riyhan Juli Asyir
By Ganda Christian Tobing, Riyhan Juli Asyir
Ganda Christian Tobing
Riyhan Juli Asyir
The government has released provisions on the imposition of safeguard import duties (Bea Masuk Tindakan Pengamanan/BMTP) on imports of carpet and other textile floor coverings products. These provisions are outlined in the Minister of Finance Regulation No. 10/PMK.010/2021 concerning the Imposition of Safeguard Import Duties on Imports of Carpet and Other Textile Floor Coverings Products (MoF Reg. 10/2021).
 
This regulation asserts that imported goods in the form of carpets and other textile floor coverings that are included in the Chapter 57 HS Codes are subject to BMTP. The imported goods classification of carpets and other textile floor coverings has been regulated under the Minister of Finance Regulation No. 6/PMK.010/2017 (MoF Reg. 6/2017) as amended by the Minister of Finance Regulation No. 17/PMK.010/2020 (MoF Reg. 17/2020) concerning the Stipulation of Goods Classification System and Imposition of Import Duty Tariff on Imported Goods.
 
MoF Reg. 6/2017 outlines that carpets and other textile floor coverings included in Chapter 57 are floor coverings made of textiles with a surface that opens when used. Several points are stipulated under this regulation in terms of BMTP on carpets and other textile floor coverings.
 
First, BMTP on carpets and other textile floor coverings is imposed for three years. Based on the provisions under MoF Reg. 10/2021, the first period is calculated from the date this regulation comes into effect and the second year and the third year are calculated from the end of the previous year. The provisions on the amount of BMTP in each period are as follows:
  1. The first year is subject to BMTP of IDR85,679/m2;
  2. The second year is subject to BMTP of IDR81,763/m2;
  3. The third year is subject to BMTP of IDR78,027/m2.
Second, 123 countries out of 193 countries worldwide are not subject to BMTP on carpets and other textile floor coverings. Countries that are exempted from this policy include imports of carpets and other textile floor coverings produced by Cambodia, Egypt, Argentina, Singapore, the Philippines, Oman, and many others. A complete list of countries that are not subject to BMTP on carpets and other textile floor coverings can be seen in the Appendix of MoF Reg. 10/2021.
 
Third, the additional import duty categorization on the imposed BMTP. The first category is additional general import duties that apply to imports from countries that have trade agreements with the most favoured nations. The second category is BMTP categorized as additional preferential import duty based on prevailing schemes of international goods trading agreement.
 
The second category applies if the import is carried out by a country with a scheme of international goods trading agreement and has fulfilled the conditions stated in the trade agreement scheme. In the event that there are unfulfilled provisions in the schemes of international goods trading agreement or a retroactive check is being requested, the imposition of BMTP on imports from said country is included in additional custom duties.
 
Fourth, the obligation to attach a Certificate of Origin (Surat Keterangan Asal/SKA) for carpets and other textile floor coverings produced by countries that are exempted from BMTP. This regulation sets forth that two CoO research policies apply. If the CoO attached is a Preferential CoO, the CoO research obligation is under the minister of finance’s authority with applicable provisions by the minister of finance. However, if the CoO attached is a non-preferential CoO, the CoO research shall be the authority of the minister in charge of trade affairs.
 
Fifth, the amount of BMTP for the 3-year period is fully applicable for imported goods in the form of carpets and other textile floor coverings that have fulfilled one of the following conditions. First, the import customs declaration document has obtained a registration number from the customs office in the event that customs obligations are settled by submitting the customs declaration. Second, the tariff and customs value are stipulated by the Customs Office, in the event that customs obligations are settled without submitting customs declaration.
 
Sixth, if the imports and exports of carpets and other textile floor coverings are to and from free trade zones and free ports, bonded storage areas, and special economic zones, they must be carried out as per applicable provisions. As such, imports carried out to and from these areas do not apply the provisions under MoF Reg. 10/2021. The BMTP policy on carpets and other textile floor coverings will take effect 14 days since its promulgation, i.e. 17 February 2021.