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The Coalition together with the Indonesian and Swedish Ministries of Finance and the Asian Development Bank (ADB) hosted a Workshop on International Carbon Pricing and Taxation on 3-4 October, 2023 in Jakarta, Indonesia (see the ​docx icon full two-day agenda). The two-day workshop consisted of eight working sessions and was tailored for practitioners in Indonesia and other Coalition countries belonging to Finance Ministries and Tax Agencies.

The workshop aimed to:

  • Provide Indonesian policymakers with an overview of international trends in carbon pricing as part of wider environmental tax reform.
  • Discuss the economic, environmental, social and revenue impact of carbon pricing and examining how countries have designed and implemented policies that address and mitigate political economy, distributional, and competitiveness concerns.
  • Review international experience and the technicalities of carbon pricing design and implementation, including tradeoffs and complementarity between carbon pricing mechanisms such as ETS and carbon tax, institutional roles and responsibilities, legal frameworks, carbon pricing mechanisms, measurement tools, revenue recycling and targeted compensation for vulnerable groups.
  • Share practitioner experience in the administration of carbon taxes and charges on both fossil-fuel goods and the emissions of entities not covered by mandatory trading, including carbon tax design architecture, drafting implementing regulations, coordination between technical agencies and tax authorities, tools to ensure low administrative costs, and public communication strategies.
  • Discuss key bottlenecks to carbon pricing in Indonesia and identifying potential policy solutions that align with the country context and which can be widely accepted and implemented.

Day 1: International experience in carbon pricing

  • Opening Remarks
    • Ms. Masyita Crystallin, Special Advisor to the Minister of Finance of the Republic of Indonesia, Co-Chair Sherpa of the Coalition of Finance Ministers for Climate Action
    • Mr. Jiro Tominaga. Indonesia Country Director, Asian Development Bank
  • Session I (Introductory Panel): Carbon Pricing in Developing Economies: Balancing Growth and Sustainability
    • Keynote/Moderator: Mr. Kurt Van Dender. Acting Head of the Tax Policy and Statistics Division, Centre for Tax Policy and Administration, Organisation for Economic Co-operation and Development (OECD)
    • Panelist: Professor Dr. Kenneth Richards, School of Public and Private Affairs, University of Indiana: Overview of the state of carbon pricing in developing countries with a focus on Asia. (​pdf icon see presentation) 
    • Panelist: Mr. Parijono, Assistant to Minister of Finance for Macro Economy and International Finance. Overview on the state of carbon pricing implementation in Indonesia. (​pptx icon see presentation)
  • Session II (Fireside Chat): From Coal to Clean: Overcoming Barriers in the Shift towards Low-Carbon Economies
    • Keynote/Moderator: Ms. Dora Benedek, Division Chief, Climate Policy Division, Fiscal Affairs Department, IMF
    • Discussant: Mr. Christian Jaramillo Herrera, Director, OnPoint Consulting, Public Policy Professor, Universidad del Rosario, and Former Executive Director of Energy and the Gas Regulatory Commission (CREG) and Deputy Director of Tax and Customs National Authority (DIAN), Colombia (​pdf icon see presentation)
    • Discussant: Mr. Gigih Adi Utomo, Indonesia’s Ministry of Energy and Mineral Resources, DG Renewable Energy and Energy Conservation: challenges to Indonesia and other economies heavy reliant on coal about the specific dilemmas and challenges faced by coal exporting countries in the transition towards a low-carbon economy (​pdf icon see presentation)
  • Session III: Carbon Trading: Economic Mechanisms and Market Dynamics
    • Keynote/Moderator: Mr. Ghislain De Valon, Senior Infrastructure Specialist, Asian Development Bank
    • Presenter: Mr. Christian J. Thomann, Associate Professor at Royal Swedish Institute of Technology: Empirical evidence of the pricing of carbon emissions in Sweden using a carbon tax and emissions trading. (​pptx icon see presentation)
    • Presenter: Ms. Susanne Åkerfeldt, Senior Adviser, Swedish Ministry of Finance, and EU Commission National Expert and Lead drafter of the CBAM proposal: General presentation on the EU CBAM – what it is about, effects on global trade and risk mitigation. (​pdf icon see presentation)
    • Presenter: Dr. Peter Wood, Assistant Manager, Safeguard Operational Policy, Net Zero Industries Division, Department of Climate Change, Energy, the Environment and Water, Australia (​pptx icon see presentation)
    • Presenter: Mr. Edo Mahendra, Special Advisor on Carbon Trading to the Coordinating Ministry for Maritime and Investment Affairs, Indonesia (see presentation)
  • Session IV: Institutional Design and Governance of Carbon Markets
    • Keynote/Moderator: Mr. Kurt Van Dender, Acting Head of the Tax Policy and Statistics Division, Centre for Tax Policy and Administration, Organisation for Economic Co-operation and Development (OECD)
    • Mr. Chris Shipley: Head of Global Carbon Markets, Department for Energy Security and Net Zero, United Kingdom (see presentation)
    • Discussant: Ms. Susanne Åkerfeldt, Senior Adviser, Swedish Ministry of Finance (​pdf icon see presentation)
    • Discussant: Mr. Khoirul Mittaqien, Head of the Special Examination and Securities Transaction Department, Financial Service Authority of Indonesia
  • Closing remarks
    • Mr. Boby Wahyu Hernawan Director of Center for Climate Finance and Multilateral Policy Ministry of Finance of Indonesia

Day 2 Program: International experience in carbon tax design and administration

  • Session I (Introductory Panel): A Comprehensive Look at the Carbon Tax
    • Keynote/Moderator: Susanne Åkerfeldt, Senior Adviser, Swedish Ministry of Finance (​pdf icon see presentation)
    • Panelist: Camilla Schmidlin Roccatagliata, Advisor to the Tax Policy Coordination at the Ministry of Finance of Chile
    • Panelist: Professor Dr. Kenneth Richards, School of Public and Private Affairs, University of Indiana: The challenges of introducing carbon taxes in Costa Rica. (see presentation)
    • Panelist: Mr. Hestu Yoga Saksama, Director of Tax Regulations I, Directorate General of Tax, Indonesia’s Ministry of Finance: Experience in preparing Indonesia’s carbon tax. (​pdf icon see presentation)
  • Session II (Fireside Chat): Debunking Misconceptions: The Economic Facets of Carbon Tax in Mid-Level Countries
    • Keynote/Moderator: Ms. Valérie Guillamo, CFMCA HP3 Coordinator, Climate Policy Division, Fiscal Affairs Department, International Monetary Fund
    • Discussant: Mr. Hadi Setiawan, State Revenue Policy Center (PKPN), Fiscal Policy Agency, Ministry of Finance, Indonesia
    • Discussant: Mr. Christian Jaramillo Herrera, Director, OnPoint Consulting, Public Policy Professor, Universidad del Rosario, and Former Executive Director of Energy and the Gas Regulatory Commission (CREG) and Deputy Director of Tax and Customs National Authority (DIAN) of Colombia (​pdf icon see presentation)
    • Discussant: Dr. Kenneth Richards, Professor at the School of Public and Private Affairs, University of Indiana: Case study on experience of South Africa, which will focus on how South Africa is attempting to incorporate land-use related emissions under its carbon tax, with a cross reference to a similar effort under New Zealand’s ETS. (see presentation)
  • Session III (Panel):  the Administrative Aspects of a Carbon Tax
    • Moderator: Mr. Firman Tatariyanto, Directorate of Tax Regulations I, Directorate General of Tax, Ministry of Finance, Indonesia
    • Panelist: Mr. Enriko Aav, IMF Senior Economist, Fiscal Affairs Department, Revenue Administration I: IMF technical note on Developing and Administering a Carbon Excise
    • Panelist: Ms. Susanne Åkerfeldt, Senior Adviser, Swedish Ministry of Finance: UN handbook on Carbon Taxation (​pdf icon see presentation)
  • Session IV: Beyond Technicalities: Building a Sustainable Carbon Tax System
    • Moderator: Mr. Samudera Putra, Directorate General for Taxation, Ministry of Finance of Indonesia
    • Presenter: Mr. Kurt Van Dender, Acting Head of the Tax Policy and Statistics Division, Centre for Tax Policy and Administration, Organisation for Economic Co-operation and Development (OECD)
  • Closing remarks
    • Mr. Yon Arsal, Expert Staff of Finance Minister for Tax Compliance, Indonesia’s Ministry of Finance

 

Group Photo