The Finance Ministry will control the deficit in the 2017 Revised State Budget at 2.7 percent of the gross domestic product.
By
·3 minutes read
Kompas/Totok Wijayanto
A tax office staff member helps taxpayers file their annual tax returns using the e-filing system at the Ciputra Mall Tax Corner, Jakarta, Wednesday (22/3).
JAKARTA, KOMPAS — The Finance Ministry will control the deficit in the 2017 Revised State Budget (APBN-P) at 2.7 percent of the gross domestic product (GDP). The deficit target is 2.92 percent or Rp 397 trillion.
Finance Minister Sri Mulyani Indrawati, responding to a question from Kompas in Jakarta last week, said the government would strive to reach the state revenue target, mainly the tax as the primary contributor. However, the government is anticipating a realization below the target.
“We will keep trying. However, given the available time [only one month left], we surely have anticipated a shortfall. At the same time, we also see from all spending until December, how much money has been spent,” Sri Mulyani said. Thus, Sri Mulyani continued, the deficit in the APBN-P 2017 was projected to be at 2.7 percent of GDP by end of the year.
Separately, Gadjah Mada University economy and public policy study center head A Tony Prasetiantono said the 2.7 percent deficit projection was moderate. The deficit projection is realistic given the economic condition of this year.
“I think the 2.7 percent deficit is moderate and realistic enough for the current situation. It is not as scary as the previous projection of 2.92 percent, which psychologically not good as it is close to 3 percent mark allowed by the law,” Tony said in Jakarta on Sunday (3/12).
Tony said fiscal stimulus with 2.7 percent deficit, combined with household spending – which normally increased in the fourth quarter – would generate the most realistic economic growth in the fourth quarter of 2017 at 5.2-5.3 percent. Thus, the full year economic growth in 2017 is estimated at 5.1 percent.
Tax
Regarding the effort to fulfill the tax revenue target as the primary state income, Sri Mulyani assured the Directorate General of Taxation (DJP) would take proportional measures in December. Indeed, particularly she instructed Robert Pakpahan – as the tax director general –who was inaugurated on Thursday (30/11) to work to achieve the maximum outcome without pressuring the business community.
“The most important thing in December is to keep trying to do the maximum for the state revenue. The instruction [to Robert] is to maintain the existing revenue, especially the baseline to be fulfilled and also to keep trying new things such as intensifying the existing data. Especially for Pak Robert, I told him to maintain public trust so people do not become worried about efforts to collect state revenue,” Sri Mulyani said.
Robert Pakpahan said his office would maximize state revenue in December through the planned strategy. At the same time, he is also committed to improving public trust in the tax directorate general. “In the short term, we will maximize the tax collection strategy of 2017 so that the deficit is maintained safely,” he said.
Meanwhile, Ken Dwijugiasteadi in his last press conference as the tax director general last week, said the realization of tax income as of end of November was 78 percent from the target of Rp 1.28 quadrillion. So, the realization of tax income is more or less Rp 1 quadrillion.
The November target, Ken said, was Rp 126 trillion. However, the realization until Nov. 30 at 10 a.m. was Rp 114 trillion. That amount was expected to grow given the incoming tax payment.
APBN-P 2017 targeted Rp 1.71 quadrillion in state revenue and Rp 2.1 quadrillion of spending. The state budget deficit was Rp 397 trillion or 2.92 percent of GDP.
Initially, the Finance Ministry projected the APBN-P 2017 deficit at 2.67 percent of GDP.
