JAKARTA (TheInsiderStories)–Indonesian government decided not to revise the 2018 state budget although some assumption including rupiah currency against US Dollar and oil price are too far from the realization.
Finance Minister Sri Mulyani on Monday (9/7) said the Indonesian government views the posture of the 2018 state budget are quite stable and does not experience a big deviation in state revenue and state expenditure. The deficit is smaller than planned at 2.12 per cent of gross domestic product (GDP) or equivalent to Rp314 trillion from an assumption of 2.19 per cent of GDP or Rp325 trillion.
“So the President [Joko Widodo] said not to revise the 2018 state budget,” she said, as quoted from the Cabinet Secretary’s official website.
Mulyani promised to convey this decision to the House of Representative. Indonesian government expected state revenue will reach 95-96 per cent of the target, while the deficit expected to lower than target.
In the tax revenue, the non-oil and gas value added tax (VAT) grew by 14.9 per cent in the first semester this year, higher than last year’s growth of 6 per cent and 2016’s growth of 7 per cent.
The tax revenues derived from VAT, growing the same as last year’s 13.6%. In terms of customs and excise, revenue grew 16.7%. And for the Income Tax (Income Tax) oil and gas increased 9%, compared to last year whose growth is -69% and 2016 -40%.
From the taxation side, another positive thing is the compliance of the taxpayer in paying taxes is the personal tax returns 14% and corporate tax return grew 11.2%.
In terms of non-tax state revenues, because with high oil prices and rupiah exchange rate, the revenue of natural resources, natural resources of oil and gas has increased quite high, grew 47.9% compared to 115 per cent of last year’s growth.
Meanwhile, the ministries/agencies expenditure in the first semester of this year reached 35 per cent, slightly higher than 33 per cent in the first semester last year. The non-ministries/agencies expenditures related to the subsidies and debt interest payment reached 43.9 per cent of this target in the first semester this year, higher than 41 per cent in the same period last year.
Bank Permata’s Economist Josua Pardede said the government’s decision not to revise 2018 state budget is an effort to maintain stability. “The government has unofficially revised downward growth, so it has been illustrated that the government’s focus now is actually maintaining stability with a well-maintained deficit,” he explained, as quoted by CNBC Indonesia.
Mulyani expected Indonesia’s economic growth in the first half of this year reaches 5.1 per cent, below the 2018 state budget target of 5.4 per cent.