Taxing Coal to Hit the Goals: A simple way for Indonesia to reduce carbon emissions

The policy brief proposes that Indonesia adopt a coal tax of IDR 78,700 (USD 5.50) per tonne, similar to India's model, to address the fact that coal accounts for 40% of the country's energy-related emissions. Such a tax would generate approximately IDR 49 trillion (USD 3.6 billion) annually, which could fund clean energy investments and support vulnerable households and coal workers. The author emphasizes that this is a simpler, faster alternative to complex carbon pricing systems and would help mitigate the 7,480 premature deaths caused annually by air pollution from coal-fired power stations.

• Implementing a coal tax of IDR 78,700 (USD 5.50) per tonne in Indonesia would generate approximately IDR 49 trillion (USD 3.6 billion) annually and is equivalent to a carbon tax of about IDR 32,000 (USD 2.20) per tonne of CO2.
• Coal is a primary driver of both emissions and public health crises in Indonesia, accounting for 40% of energy-related emissions and causing 7,480 premature deaths every year due to air pollution-related diseases.
• India provides a feasible precedent for this policy, having implemented a coal 'cess' in 2010 that raised USD 3.7 billion in 2019 despite having similar challenges to Indonesia, such as a large domestic coal industry and significant poverty.

APA

Laan,, T. B. S. (2021). Taxing Coal to Hit the Goals: A simple way for Indonesia to reduce carbon emissions. International Institute for Sustainable Development. https://www.iisd.org/publications/taxing-coal-indonesia-reduce-carbon-emissions

Chicago

Laan,, Theresia Betty Sumarno,Tara. Taxing Coal to Hit the Goals: A simple way for Indonesia to reduce carbon emissions. International Institute for Sustainable Development, 2021. https://www.iisd.org/publications/taxing-coal-indonesia-reduce-carbon-emissions.

Wikipedia

{{cite report |last1=Laan, |first1=Theresia Betty Sumarno,Tara |title=Taxing Coal to Hit the Goals: A simple way for Indonesia to reduce carbon emissions |publisher=International Institute for Sustainable Development |date=20 August 2021 |url=https://www.iisd.org/publications/taxing-coal-indonesia-reduce-carbon-emissions |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{laan2021taxing, author = {Laan,, Theresia Betty Sumarno,Tara}, title = {{Taxing Coal to Hit the Goals: A simple way for Indonesia to reduce carbon emissions}}, institution = {International Institute for Sustainable Development}, year = {2021}, month = aug, url = {https://www.iisd.org/publications/taxing-coal-indonesia-reduce-carbon-emissions}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }