News dalla rete ITA

17 Settembre 2020

Indonesia

DEFICIT TO REACH 5.7% OF GDP IN AS UNCERTAINTY HITS TAX REVENUE

Finance Minister Sri Mulyani Indrawati told the House’s Budget Committee during a hearing that they were seeing huge economic uncertainty and thus they would make changes to the tax income target to reflect the situation. They would remain vigilant and optimistic in facing these economic challenges. The government now expects the fiscal deficit to reach Rp 1 quadrillion, 5.7 percent of GDP, and increase by Rp 35.2 trillion compared to the previous estimate of 5.5 percent of GDP, as tax income will fall further. However, the government would maintain its economic growth target at around 5 percent that no one could truly know the trajectory of the pandemic in the next 12 months.The outlook for GDP this year is within the range of a 1.1 percent contraction to a 0.2 percent expansion. The government collected Rp 601.9 trillion in taxes in the first half, down 14.7 percent year-on-year and around 50 percent of this year’s target as business activity cooled. The government expected a greater tax shortfall this year following a change in its economic growth estimate. Next year, state income was expected to reach Rp 1.74 quadrillion, down Rp 32.7 trillion from the previous projection due to lower income from non-oil and gas taxes. Tax income might reach Rp 1.22 quadrillion next year, a drop of Rp 38.9 trillion compared to the previous estimate. Meanwhile, state spending is expected to increase by Rp 2.5 trillion to Rp 2.75 quadrillion next year, driven by higher government spending on energy subsidies, particularly for liquefied petroleum gas, at Rp 2.4 trillion. Indonesia’s economic recovery is expected to take longer than expected as a recent surge in virus cases has dented people’s confidence in the economy, as reflected by recent sales data, which indicates domestic consumption remained weak even after the economy reopened. Critics of the decision say the policy might further hinder economic recovery, but supporters of the decision say it is necessary to prevent the healthcare system from collapsing. The economy has been losing steam since August as virus cases jump. Indonesia's GDP contracted 5.32 percent in the second quarter as household spending and investment shrank. (ICE GIACARTA)


Fonte notizia: The Jakarta Post – 15/9/2020