Forestry officials questioned for tax evasion

EoF News / 06 January 2010

PEKANBARU (EoF News)—Three officials at Indragiri Hilir Forestry Service were questioned by the Riau Province Forestry Service for allegedly manipulating hardwood tax from timber cleared by PT Sumatera Riang Lestari, an associated company to Asia Pacific Resources International Holdings Limited (APRIL).

Thousands of mixed logs that cleared in natural forest in Kerumutan block were seized by the police in Siak river in November and December 2009. Latest development that reported by Riau Mandiri daily (4/1/2009) said that the involvement by the district forestry service officials hinted illegal cooperation by the civil servants and the APRIL’s company, PT SRL, for alleged tax evasion.

The report said the conspiracy had inflicted billions of rupiah loss to the State by evading Rehabilitation Fee (DR) and Provision of Forest Resources (PSDH). Asmawi, a resident from Kempas sub-district, said that the company paid 2 US dollar less than it ought pay amount to 14 US dollar per cubic meter for Meranti hardwood.

In November and December last year, the Riau Forestry Service had found thousands of logs transported in Siak River and others piled in dockyard of PT Asia Forestama Raya, in Siak District. The Forestry Service Head, Zukifli Yusuf, said thousands of logs found in PT Asia Forestama Raya could be illegal (Kompas, 1/12/2009). He told media that the document for timber permit transportation was inconsistent with the weight of timbers that loaded by the tug boats.  

Asmawi said PT SRL should be questioned by the Riau Forestry Service too for involvement in the illegal practice altogether with the three officials. 

“As data we have, Provision of Forest Resources that submitted [to the State] is relatively few compared to volume of logs taken out from this area each week,” Asmawi told Riau Mandiri.

Last month Wahana Lingkungan Hidup Indonesia (WALHI/Friends of Earth Indonesia) of Riau office published an Investigative Report on natural forest clearing by  APRIL’s PT SRL. At least 1,000 hectares of natural forest in Rangsang Island (Pulau Rangsang), Kepulauan Meranti district, Riau Province, had been cleared by PT SRL, started in May 2009, which is threatening one of few strategic outer islands in the country to sink as well as the emission carbon from the peatland.

In August 2009, EoF released Investigative Report on PT SRL clearing in Kerumutan forest block. The report concluded that PT Sumatera Riang Lestari’s logging operations were legally highly questionable, creating social conflicts, destroying potential HCVFs and causing significant CO2 emissions.

The investigation found that PT Sumatera Riang Lestari, in the Kerumutan forest block, was clearing natural forest, digging canals and building worker camps under legally-questionable circumstances.


EoF report on PT SRL