Govt plans higher royalties on nickel, gold, copper, tin amid price rally

The government is considering raising royalty rates for a range of mineral commodities, including nickel, gold, copper and tin, as the government seeks to boost state revenue from strong commodity prices, according to presentation materials from the Energy and Mineral Resources Ministry reviewed by Bisnis.com.

The proposed changes were discussed during a public consultation held by the ministry on Friday on revisions to Government Regulation No. 19/2025 governing non-tax state revenue in the mining sector.

The ministry said the revisions were aimed at capturing higher state revenue amid elevated prices for major mineral commodities, including copper, gold, nickel and tin.

Under the proposal, the royalty rate for copper concentrate produced by miners including PT Amman Mineral Nusa Tenggara would rise to 9% from 7% when copper reference prices (HMA) are below $7,000 per dry metric ton (dmt). The top royalty rate would increase to 13% from 10% when prices exceed $13,000/dmt.

Gold royalty rates would also rise sharply. Under the current regulation, gold priced below $1,800 per troy ounce is subject to a 7% royalty. The new proposal would impose a 14% royalty for gold prices below $2,500/toz, with rates rising progressively to 20% when prices exceed $5,000/toz.

Read also: Amman joins global copper body ICA as first Southeast Asian member

For nickel ore, the government plans to lower the pricing thresholds used in the progressive royalty structure, with the top royalty bracket of 19% applying at prices above $26,000 per ton instead of the current $31,000 threshold.

Tin royalty rates would also increase significantly, with the top rate rising to 20% from 10% when prices exceed $50,000 per ton.

The revised regulation would also introduce royalty arrangements for cobalt produced as a by-product of nickel matte processing, as well as zinc and lead concentrates. Additional fixed fees are also being proposed for non-metallic minerals and rocks located more than 12 nautical miles offshore.

Proposed changes to Indonesia’s mineral royalty rates

Copper concentrate royalty

Copper HMA (US$/dmt)	Current rate (%)	proposed Rate (%)
< 7,000	7	9
7,000 - < 10,000	-	11
10,000 - < 13,000	-	12
≥ 13,000	-	13

Copper cathode royalty

Copper HMA (US$/dmt)	Current rate (%)	proposed Rate (%)
< 7,000	4	7
7,000 - < 8,500	5	-
8,500 - < 10,000	6	-
7,000 - < 10,000	-	8
10,000 - < 13,000	-	9
≥ 10,000	7	-
≥ 13,000	-	10

Gold royalty

Gold HMA (US$/toz)	Current rate (%)	Proposed rate (%)
< 1,800	7	-
≥ 3,000	16	-
< 2,500	-	14
2,500 - < 3,000	-	15
3,000 - < 3,500	-	16
3,500 - < 4,000	-	17
4,000 - < 4,500	-	18
4,500 - < 5,000	-	19
≥ 5,000	-	20

Nickel ore royalty

Nickel HMA (US$/ton)	Current rate (%)	Proposed rate (%)
< 18,000	14	-
≥ 31,000	19	-
< 16,000	-	14
16,000 - < 18,000	-	15
18,000 - < 20,000	-	16
20,000 - < 22,000	-	17
22,000 - < 26,000	-	18
≥ 26,000	-	19

Silver royalty

Silver HMA (US$/toz)	Current rate (%)	Proposed rate (%)
All prices	5	-
< 60	-	5
60 - < 80	-	6
80 - < 100	-	7
≥ 100	-	8

Tin royalty

Tin HMA (US$/ton)	Current rate (%)	Proposed rate (%)
< 20,000	3	5
20,000 - < 30,000	5	7.5
30,000 - < 35,000	-	10
35,000 - < 40,000	-	12.5
40,000 - < 45,000	-	15
45,000 - < 50,000	-	17.5
≥ 50,000	10	20

 

Editing by Reiner Simanjuntak