Fact Sheet | Legal Breakthrough in the Regulation of Revenue Sharing Funds for Reforestation Funds (DBH DR)

201901.FS-TerobosanHukumPengaturanDBHDRRevenue Sharing Funds for Reforestation Funds (DBH DR) are funds allocated from the State Budget for timber-producing regions from natural forests for the purposes of reforestation and rehabilitation. The percentage of DBH DR is 40% of the total receipt of reforestation funds, while the other 60% is provided by the Central Government. The Reforestation Fund itself consists of funds collected from holders of business licenses for the utilization of natural forests in the form of timber. The Reforestation Fund belongs to the category of non-tax state revenues.

Initially the DBH DR was distributed to Regency / City Governments. However, since the enactment of Law No. 23/2014 concerning Regional Government, which has an impact on the transfer of forest management from the Regency / City Government to the Provincial Government, starting in 2017 the DBH DR is channeled to the Provincial Government.

The absorption of DBH DR is experiencing obstacles so that much of the funds have been deposited in the regional treasury. Based on data from the Directorate General of Fiscal Balance of the Ministry of Finance (DJPK), the DBH DR that remain in the accounts up to 2017 and are calculated as SiLPA (Excess Budget) reach Rp 4.8 trillion. This amount is the accumulation of the remaining DBH DR in the regencies/cities of Rp 4.516 trillion and in the provinces of Rp 291 billion. This means that the absorbed DBH DR only reached 27.68% or Rp 1.84 trillion from the total amount transferred by the government of Rp 6.6 trillion. The large amount of the unused funds is mainly due to strict regulation of the Government Regulation on Reforestation Funds, GR No. 35/2002. According to the GR, the Reforestation Funds can only be used for Forest and Land Rehabilitation (RHL) and its supporting activities, while on the other hand the amount of critical land that should be rehabilitated is limited. Not to mention the Regional Government Law stipulates that planting in forest areas is the sole authority of the Central Government.