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Free Import Duty of Raw Material for PPE and Medical Mask Continue in 2021

Jakarta, January 7, 2021


To overcome the shortage of raw material at home for Personal Protective Equipments and medical masks, government will continue to provide incentives in the form of exemption from import duty or import tax on raw materials borne by government in 2021. Director of Textile, Leather and Footwear Industry at the Industry Ministry, Elis Masitoh in FGDs conducted in Bandung via offline and online recently said that government would continue to provide facilities for exemption from import duties or import duties borne by government for importing PPE raw materials and medical masks to overcome the shortage of raw materials in the country.

Meanwhile, for types of PPE and non-medical masks currently oversupplied in the country the import duty is revoked or re-imposed and export is allowed. From the presentation slides in the FGDs indicated that up to December 2020 there was an oversupply of Medical Coveralls totaling 345,873,747 out of total requirement 8,529,188, Gown / Surgical (Medical Grade) oversupplied accounted for 221,138,721 from requirement by December 2020 accounted only for 3,212,982, surgical masks oversupplied for 3,509,683,829 from requirement by December 2020 accounted only for 129,839,311

On the other hand, there is a shortage of medical masks (N95) until December 2020 as many as 4,405.84 because the total requirement for this masks type accounted for 7,645,684. This happens because producer of medical masks (N95) at home is only one company with a monthly production capacity 360,000. The same thing happened to the supply of raw materials in the form of spunbond & meltblown. By December 2020 there were only two producers with a total production capacity per month 250 and by December 2020 total production had only reached 2,250 combined, compared to total need of 4,659,705 by December 2020.

This absolutely means that local producers cannot meet high domestic demand for this type of raw material. The shortage of raw materials has caused serious problems in the production of medical PPE driving the price of raw materials is very high and unpredictable at home. Speaker from Ministry of Health in this event said that in the beginning the price of spunbon was around US $ 2 / kg and now it has increased to around S $ 111 / kg due to the shoetage of raw materials in the market.

PPE and medical masks in accordance with the minister of finance regulation No.134 / PMK.010.2020, the budget allocated for PPE in protective clothing was Rp. 153 billion and PPE in masks amounted Rp. 12 billion. Industry Ministry reported that companies have yet to fuly use the incentives provided as around Rp. 5 billion used by December 2020.

For this reason, the Ministry of Industry asks companies to use the incentives provided by government in the form of import duties for raw materials borne by the government for the fulfillment of raw materials for masks and PPE in 2021. According to Elis, the Ministry of Industry is open for opinions from textile businessmen related to incentives for the advancement of national textile and clothng industry.