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George russell
Indonesia’s finance minister called on taxpayers to help bolster the country’s finances ravaged by the pandemic, state media reported on Monday.
“Why do we pay taxes? It’s to protect Indonesia, ”said Sri Mulyani Indrawati, quoted by the Antara news agency.
Indonesia is expected to record a budget deficit of 6.4% of gross domestic product in 2020 and a deficit of 5.8% in 2021.
Last week, Ms Indrawati said the country’s tax target of 1,405 billion rupees ($ 100 billion) could not be met due to revenue pressure from the Covid-19 pandemic.
Appealing to taxpayers at an online finance ministry event in Jakarta on Monday, Ms Indrawati said, “The money is being collected so that Indonesia can show up again.”
A woman looks at a painting at an exhibition in Ubud in Bali. Local government encouraged artists to continue working during pandemic
She said tax revenue from January to September was only 63% of the nine-month target figure.
The limited revenues of the Indonesian government are likely to hamper the country’s post-pandemic recovery.
“Like most other emerging market economies, the Indonesian government’s spending capacity is constrained by its low revenue pool and high borrowing costs,” Fitch said in a report last week.
“As such, the government has provided a relatively modest stimulus package in 2020 of 2.7% of GDP, compared to 16.1% by neighboring Singapore,” the rating agency added.
On November 11, Indonesia signed a $ 1.09 billion loan agreement with Australia to help the Southeast Asian country respond to the pandemic.
“Everyone, all parts of society, is hurt by this Covid-19 and the role of fiscal policy, as well as other instruments, like monetary policy, is very critical during this difficult time,” said Mrs. Indrawati announcing the loan.
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